Intel wants to be friends with Apple — or more specifically, Apple’s hoard of cash. As the PC industry craters and mobile devices seem to be the future, the chipmaker wants the tech giant to buy its Medfield design. Although Intel if talking, is Apple listening?
It’s not like Intel has its hat in hand, but it certainly is button-holing participants at the CES tech gathering. As we’ve been reporting all week, Apple is topic No. 1 in Las Vegas. Although Android is high on Intel’s list, company VP Dave Whalen told the Telegraph that he’s “talking to everybody.”
But Intel could have a tough sell with Apple. We recently reported that one Wall Street expert is betting against the chipmaker, predicting it is Apple that holds all the cards when it comes to mobile chips. Sterne Agee analyst Vijay Rekesh downgraded Intel stock from Buy to Neutral, noting Intel rival ARM is coming on strong. What with declining sales of x86 chips to PC makers, Intel must turn to mobile devices, which could be an uphill climb.
According to Rekesh, during 2012-2013, major PC makers will adopt ARM in 10 to 15 percent of their devices — or 1 million PCs. To balance the loss of the more expensive PC chips, Intel will have to sell 4 million of the less-expensive mobile chips. Here again, Intel is in a tight spot.
That’s because it is smaller companies, such as Qualcomm and Marvell, that have the upper hand in mobility. Qualcomm is often used by smartphones, while Marvell produces ARM-based designs making their way into set-top boxes, such as Google’s TV device. Which also brings us back to why Intel is chasing after Apple while not trying to seem too needy. But Apple may be giving Intel a polite brush-off.
First, Apple has a long-standing relationship with ARM. The A5 chip is based on an ARM design. Apple has also spent mucho bucks securing primary contracts with Samsung and other chipmakers. Then there is the growing number of chip investments by Apple, including its latest, Anobit.
Of course, there is precedence for Apple to link up with Intel. But PCs are an entirely different animal than the iPhone or iPad. The reason Apple spent all the money on chip companies is its well-known need for control. Why drop that for a generic mobile SoC like Medfield?
But Intel shouldn’t worry. This year’s CES reportedly spans 35 football fields of vendors — someone must want to hire a down on its luck chipmaker.