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Intel Hopes to Gain Phone Share, Without Having to Pay for the Privilege

In order to win business, Intel is actually paying device makers to use its chips.


Intel looks like it will reach its goal of powering 40 million tablets this year — but it will come at a huge cost.

That’s because the chips Intel is using require more expensive tablet designs. In order to win the business, Intel is actually paying device makers to use its chips.

“I don’t want to do that with phones,” CEO Brian Krzanich said in an interview ahead of the company’s developer conference in San Francisco. “I would really like to avoid that.”

Krzanich says Intel hopes to land in a half dozen or more phone makers’ products next year — and to do so without having to eat any additional costs. It is counting on a product, known as SoFIA, that is made outside Intel’s own factories.

By the end of the year, Krzanich said he should have a better sense of whether the chip is on track and just how many phone chips it might be able to sell. For the moment, the company is happy to tout a bit of progress in its struggling modem business. Intel says a new LTE modem chip will ship in some versions of Samsung’s Galaxy Alpha phone.

On the tablet front, Krzanich says Intel is making good progress. At the Intel Developer Forum, the chipmaker is showing off a slim new Dell tablet, the first to incorporate a depth-sensing camera technology from Intel. The goal, Krzanich said, wasn’t to pay to land in a bunch of tablets just to say it grabbed some tablet business. Rather, he said, the company can bring long-term innovation, and the subsidies it paid this year were the price of entry.

Intel is making a handful of other announcements at the show, though no blockbuster new products are being debuted. One new effort is a connected wheelchair. The company is expected to call on Steven Hawking via video conference to discuss the technology.

“It’s a great example of the creativity and, to me, the maker environment, even within Intel, [which] we are trying to promote,” Krzanich said, noting the project was done by Intel interns and other workers taking it on as a side project. “We are probably not going to sell a billion of them … [but] it is the right thing to do.”

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