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Intel Invests $1.5B to Boost Its Mobile Assets

Ray Le Maistre
9/26/2014
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Intel is adding to its wireless assets with a US$1.5 billion investment in Chinese mobile chipset specialist Tsinghua Unigroup Ltd.

Intel Corp. (Nasdaq: INTC) is taking a 20% stake in Tsinghua Unigroup, which owns two fabless semiconductor developers, Spreadtrum Communications and RDA Microelectronics. Spreadtrum and RDA, which were both acquired by Tsinghua Unigroup in the past year, develop 2G, 3G and 4G mobile chipset platforms for wireless devices, including smartphones. (See Tsinghua Unigroup Closes US$907 Million Acquisition of RDA Microelectronics and Tsinghua Unigroup Completes Acquisition of Spreadtrum.)

Intel says it will jointly develop and market mobile products in China and in international markets with Tsinghua Unigroup, with the aim of expanding "the product offerings and adoption for Intel-based mobile devices in China and worldwide."

Earlier this year, Intel opened a Smart Device Innovation Center in Shenzhen and announced a $100 million Intel Capital China Smart Device Innovation Fund. (See Intel CEO Gives It Large in China.)


For the key developments in the comms chips sector, check out our dedicated components content channel here on Light Reading.


With these moves, Intel is further signaling its intention to challenge wireless device chip market leader Qualcomm Inc. (Nasdaq: QCOM), which has been bolstering its position in the 4G device market lately but also having trouble in China. (See Qualcomm Looks to Soften China Antitrust Blow and Qualcomm Paves Way for Sub-$100 4G Phones.)

Intel had previously acquired the Wireless Solutions unit of Infineon Technologies AG (NYSE/Frankfurt: IFX) in 2010, and renamed it Intel Mobile Communications. That unit has about 4,000 staff globally, ships hundreds of millions of units per year, and is preparing for the mass launch of its SoFIA mobile chips that are being designed for entry-level 3G and 4G devices, a market where Qualcomm has just made a splash. (See Qualcomm Paves Way for Sub-$100 4G Phones, 2014: Intel's Year of Living Wirelessly? and Intel to Acquire Infineon's Wireless Biz.)

The investment in Tsinghua Unigroup, which is expected to be completed in early 2015, is just the latest in a series of moves that will strengthen Intel's mobile-related portfolio.

In August it announced the $650 million purchase of the Axxia networking chip unit from LSI, which will strengthen its position in the wireless network and enterprise equipment market. Prior to that it acquired the wireless assets of Mindspeed Technologies Inc. (Nasdaq: MSPD). (See Intel ARMs Itself for IoT, SDN Opportunities and Intel Confirms Mindspeed Wireless Buyout.)

The move comes as the Chinese government and industry organizations adopt a strategy to expand the country's role in the global chip market.

— Ray Le Maistre, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, Editor-in-Chief, Light Reading

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DOShea
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DOShea,
User Rank: Blogger
9/26/2014 | 9:35:48 PM
Re: What timing!
Intel has been making a lot of moves lately to broaden its appeal in different market segments, but critics kept point out that it needed a stronger, perhaps bigger, mobile device play. It looks like Intel is addressing that weakness.
Gabriel Brown
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Gabriel Brown,
User Rank: Light Sabre
9/26/2014 | 12:47:26 PM
Re: What timing!
It's a big play for Intel, huh? Will be very interesting to see how it works out.
Ray@LR
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[email protected],
User Rank: Blogger
9/26/2014 | 10:38:54 AM
What timing!
What a series of events in China!

Tsinghua buys two companies, Qualcomm gets hauled over the legal coals in China, and then Intel invests in Tsinghua to work with the two mobile device chipset companies it just acquired.

Who'd have seen that coming?
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