Intel Sizing Up Sale of Home Connectivity Unit – Report

In a move that could disrupt the silicon sector for cable modems and gateways, Intel Corp. is seeking buyers for its connected home chip unit, Bloomberg reported, citing unnamed sources said to be familiar with the matter.

Intel has not commented on the report, which appeared just prior to the US Thanksgiving holiday. Bloomberg said Intel has already hired a financial advisor to sell the unit which has annual sales of about $450 million and includes WiFi and smart home products. Intel sold its smartphone modem business to Apple in July in a $1-billion deal.

Home connectivity is a small piece of Intel's overall business -- the company pulled down $19.2 billion in Q3 2019 alone -- but the sale could shake up cable's already troubled consumer premises equipment (CPE) market. Operators such as Comcast have always made a point of buying gateways and other broadband devices powered by chips from at least two suppliers. A sale of Intel's home connectivity unit would obviously put the fate of one of cable's key silicon suppliers in flux.

Intel entered the cable chip game in a big way in August 2010 when it acquired Texas Instruments's cable modem product line.

A sale of the unit, which counts Broadcom as its primary competitor in the cable CPE market, would also come at an important time in cable's access network evolution: CableLabs has work underway for DOCSIS 4.0, the next generation of the industry's all-important IP platform for widely deployed HFC networks.

It's not clear yet who would be interested in acquiring Intel's home connectivity division, though there has been speculation in the cable industry of late that a new, private entity might want to snap up those assets and take a fresh run at Broadcom's strong grip on the market. STMicroelectronics emerged as a third supplier of DOCSIS chipsets in recent years, but the company eventually pulled back its plans to chase that market.

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— Jeff Baumgartner, Senior Editor, Light Reading

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