Intel chef Paul Otellini says he checked the opinion of Apple CEO Steve Jobs before buying German chipmaker Infineon Technologies’ wireless unit for US$7.7 billion. The deal makes Intel a major supplier of the baseband chips that let mobile phones connect to cellular networks.
Intel chef Paul Otellini says he checked the opinion of Apple CEO Steve Jobs before buying German chipmaker Infineon Technologies’ wireless unit for US$7.7 billion. The deal makes Intel a major supplier of the baseband chips that let mobile phones connect to cellular networks.
“Steve was very happy,” Otellini told Fox Business TV. “The industry was abuzz that this business unit was on the market, and there were a number of competing companies for it. I think they are very happy that Intel won the bid.”
The purchase gives Intel a major foot in the door of the booming smartphone business. Infineon’s baseband chips are used in Apple’s iPhone as well as the hot-selling Samsung Galaxy S Android phone.
Infineon has held about 5.5 percent of the mobile phone chip market, with revenue of $13 billion, placing it behind Qualcomm, Texas Instruments, STMicro and MediaTek, according to a Gartner survey.
But Otellini says it’s not just the smartphone market that made the Infineon product attractive. He says the acquisition will see Intel delivering wireless Internet connections to other products, including laptops, tablets, televisions and other consumer electronics products.
“The key thing is the technology they have today, the customer connections they have today, and where the technology in general is going,” Otellini said.
“We look forward to a period in the not-so-distant future where all of these functions can be on a single chip. Intel has great capabilities and applications processors today, but bringing in the capabilities for 3G and ultimately LTE (Long-Term Evolution) onto the chip, that makes a lot of sense to us from an economic and power standpoint.”
Intel has been trying for years to adapt its x86 technology for mobile phones and other products, most recently with a dual-core Atom processor.
But chip designs licensed by ARM of the UK have proved most popular in mobile phones, largely because they have offered better performance and lower power consumption.
The Infineon purchase comes just days after Intel warned of weak sales for its PC processors in the current quarter.
