updated 07:30 am EDT, Mon August 30, 2010
Intel buys Infineon unit for 3G notebooks, tablets
Intel on Monday confirmed its plans to buy Infineon's wireless division for $1.4 billion in cash. The deal will see the Wireless Solutions group work as a stand-alone company on Intel's behalf and will give the company access to both 3G chipsets and a faster path to LTE-based 4G. It plans to use these not only for full-size notebooks but also Atom-based smartphones and tablets.
Infineon claimed the selloff was a win as it allowed a new focus on car, industrial and security technology. The sale is widely known to be prompted by the company's struggles with making its wireless section profitable.
The deal should be finished by early 2011.
In an attempt to head off concerns, Intel said the stand-alone nature of the wireless group would let it keep serving existing customers, including those who use ARM chips. Concerns had been raised that the buyout would be used to force Apple to seek alternate suppliers for 3G chipsets in the iPad and iPhone, although the iPhone 4 is exempt as it has switched away.
The acquisition follows the higher profile still acquisition of McAfee and reflects a concerted effort to make Intel relevant in the mobile arena through on-chip security and now full wireless hardware. ARM and companion chipset producers like Broadcom, Qualcomm and Skyworks have so far been dominating phones and tablets as Intel's Atom processors are still too large and power hungry to compete. HP is believed to have relegated its Windows tablet to enterprise as the Atom chip would give it just half the battery life of an ARM-based iPad or the similarly founded, upcoming webOS tablet.
Intel's plans are due to come together until 2011, when its Oak Trail platform for Atom chips should be efficient enough to be competitive.