Is Intel’s New Strategy Primed for Success?
Intel Corp’s (NASDAQ:INTC) new chief executive officer, Brian Krzanich, outlined his plans for the company on Friday. As consumers increasingly move away from personal computers and towards smartphones, tablets, and wearable devices, he says it is important to focus on a fast roll-out for mobile chips. He also spoke about the company’s plans regarding television — or lack thereof.
As far as television goes, Krzanich is much more cautious about what the future holds for Intel. ”We believe we have a great user interface and the compression-decompression technology is fantastic,” he says. ”But in the end, if we want to provide that service it comes down to content. We are not big content players.” When it comes to content, companies such as Apple (NASDAQ:AAPL) are much more primed for success and are looking to dive into the market. Intel has yet to finalize any deals with major content companies.
Krzanich does believe, however, that Intel needs to be ready when the move towards wearable computing units takes hold. Along with Google’s (NASDAQ:GOOG) Google Glass, he believes that wearable computing units like Apple’s rumored iWatch will become increasingly common. ”We’re trying to get our silicon into some of them, create some ourselves, understand the usage and create an ecosystem,” Krzanich says.
Krzanich and Intel President Renee James want to give more priority to their Atom mobile chips, explaining that they want to make sure not to fall behind in technology as the landscape starts to shift away from PCs. ”We see that Atom is now at the same importance, it’s launching on the same leading edge technology, sometimes even coming before Core (Intel’s line of PC chips),” Krzanich said. While Atom mobile chips were sometimes not given the priority of PC chips during the manufacturing process, that’s all about to change.
At the moment, smartphone manufacturers like Apple and Samsung (SSNLF.PK) mostly use processors designed with architecture licensed from Britain’s ARM Holdings Plc. (NASDAQ:ARMH) But, Intel would like to change that, and Wall Street has speculated that the company could make a deal with Apple in the future.
The change of strategy appears to be paying dividends. Samsung has chosen Intel processors for one of its top-tier Android tablets — a first. Last month, Intel unveiled Silvermont which represents a huge overhaul of its mobile processor. The new chip has improved performance and lower power consumption putting it in position to better compete with Qualcomm (NASDAQ:QCOM).