After four years of trying, struggling, and promising, Intel scored its first big win in June with the announcement that Samsung, far and away the dominant player in the Android tablet space, would use its Bay Trail line of Atom processors in the Galaxy Tab 3 10.1.
Intel's failure to break into the mobility space -- mobility defined as tablets and smartphones, and not mobile PCs -- has been a sore spot and is rumored to be the reason Intel CEO Paul Otellini retired a few years before hitting the mandatory retirement age. The word is 'impatience', with Intel's failure to stem the ARM tide in mobility leading the Intel board to decide a change was needed at the top to get things going.
Given these deals are made months before the product launches, the Samsung deal is Otellini's first and last hoorah in mobility. Now it's up to his successor, Brian Krzanich, to build on that. Indeed, within days of taking over the company, Krzanich reorganized the company's structure to create a new unit, unofficially called "new devices" and headed by a veteran mobile technology executive.
Will Samsung Save Intel's Bacon?
The question now is whether Intel can build on the big win. There are many ways to look at the Samsung win, and all are plausible.
Samsung is a company with a lot of "onsie and twosie" products, notes Roger Kay, president of Endpoint Technologies, a mobile device market researcher. It makes a whole lot of products to play in a wide variety of markets, but no promises it will go full bore on any of them.
"Because there's these onesie-twosies in an otherwise unified line of [Qualcomm's ARM-based CPU] Exinos and Android products, I'm wondering to what degree they are underwritten by the suppliers by NRE and co-marketing funds," he said.
A NRE or non-recurring engineering agreement is more or less a supplier paying an OEM to carry their product. In return for the OEM making a product with a chip, the chip maker agrees to underwrite R&D, marketing, and manufacturing. How close it comes to bribery depends on your perspective... and whether you are a competitor.
Samsung is also notorious for making products and then leaving them to the wolves. It was supposed to release the Galaxy ATIV S, which was to have been a version of the very popular Galaxy S III running Windows Phone 8. That product never made it to market, essentially ceding the WP8 market to Nokia and depriving users of Microsoft's mobile operating system the hottest piece of mobile hardware not made by Apple.
Samsung isn't alone in this strategy, notes Kay. Lenovo is taking the same route where it fills every niche with at least one thing to try it out. Just because it does have something ut there doesn't mean the company can't withdraw the product from the market, he notes.
However, IHS iSuppli analyst Craig Stice thinks this will gain some momentum for Intel. "They will be able to gain some market share. They will win some contracts. To what extent they will grow market share versus other markets, I don't think they will ruin other people's market share. There's too much established territory," he said.
He agreed with Kay's point that Samsung could also just be spreading out to avoid all of its eggs in one basket. "It seems diversification has a lot of value to platform guys. That's the name of the game these days, but Intel's got a good chip. Bay Trail is supposed to be much better for price and performance," he said.
App Compatibility Is Critical
One thing in Intel's favor is app compatibility. It has its own port of Android for x86 and has made very sure the most popular apps will run on it. Changing platforms is agonizing, as Apple developers learned during the PowerPC-to-Intel shift. But x86 Android will run apps from Google Play even if they were compiled for ARM, according to Ian Fogg, director of mobile and telecoms at IHS iSuppli.
"Intel is keen to have Android devices and Google are keen to run on x86, so there is impetus on both sides to make this work," said Fogg. He added the caveat that apps in emulation mode may not be as fast as native apps and take more battery power, and apps that talk directly to the hardware are more likely to break.
In the end, it's wait and see mode. ARM still rules, said Kay. "In the high mobility environment, ARM is still king and Intel is still the challenger. So far they have a beachhead at best," he said.
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