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BY ERIK SHUTE

 

Intel is back, taking its shopping spree into its second week.  Last week, security company McAfee; this week, German-based Infineon’s wireless division with a $1.4 billion price tag.  SmarTrend had this to report on Intel’s decision.

“Intel said that the unit will operate as a stand-alone business and expand Intel’s product offering in the WiFi and 4G WiMax space.  President and CEO Paul Otellini said ... ‘As More devices compute and connect to the Internet, we are committed to positioning Intel to take advantage of the growth potential in every computing segment…’”

Infineon provides smart phone chips for several high-profile clients, including Samsung, Nokia, and LG. Its recently cast lot, Wireless Solutions, provided 30 percent of Infineon’s $1.17 billion revenue last year.  Market News suggests that will help finally establish Intel’s presence in the mobile market.

“Intel said the unit will also contribute to its strategy to make connected computing ubiquitous from smart phones to laptops to embedded computing.”

Infineon’s acceptance into Intel’s growing “family tree” allows the company’s roots to spread across multiple technological platforms, and now mobile devices. Jessica Davis of Channel Insider’s Blog says she believes that Intel needs family now more than ever.

“This is where Intel wanted to go a few years ago. But now the timing is right. More consumer devices will be coming to the workplace. Companies will be looking to integrate those devices with corporate applications and secure it.”

In the future, the processor mogul hopes to compete “inside” its leading chip competitor AMD and take advantage of the surging demand for mobile devices. Ed Sutherland of the blog Cult of Mac explains how bad blood could boil between AMD’s clientele, including Apple.

“It is unsure how Intel and Apple will co-exist under the new arrangement. The Cupertino, Calif. company opted against using Intel to power its iPhone, choosing instead Rival AMD. ... For its part, Intel in 2008 blasted the iPhone as incapable of fully accessing the Internet without the chip giant’s help.”

The merger will have an effect on Intel’s competition and current patrons, but others believe Infineon is going to be the one to catch the short end.  Infineon Technologies’ analyst, Adrien Bommelaer commented on Intel’s lackluster compensation.

“Although the divestment by Infineon of its wireless business to Intel makes strong strategic sense, the price tag is a clear disappointment and looks likes a fire sale…”

Intel is expected to rejuvenate its transparent wireless program, allowing up to four years of direct research into smartphone testing, research that could see them to the forefront of mobile technology.

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