Intel has agreed to buy Texas Instruments' cable modem division for an undisclosed sum. Analysts at Jeffries estimate the activities have annual sales of around USD 100 million. The acquisition will help Intel increase its ties with the cable industry by developing consumer electronics end-products based on Intel's media processing technology, Atom.
The acquisition is notable and brings to mind a number of Intel's agreements in the connected (hybrid) TV arena. It's been Intel's ambition for a number of years to get in chips not only in computers but also in any number of electronics, such as TVs. The most striking agreements in this area have been a deal with cable group Liberty Global, which is expected to result in a hybrid set-top box by next April, and an agreement with Google, which plans to have boxes and TVs with its software ready this autumn. Samsung, NDS and Nagravision are also involved with Liberty Global (and as such its European cable unit UPC), while Sony, Logitech, Best Buy and Dish are working with Google (see also our series of Research Briefs on connected TV and OTT).
With the takeover of the Texas Instruments activities, Intel is clearly trying to secure a market for its Atom chips. But something else seems to be happening. In the above agreements, Samsung and Sony committed to delivering next-generation set-top boxes, and now Intel is also getting involved. It's merely speclation, but given the launch delays at a number of box producers (Boxee, Yuixx, Amino), it seems everything's not quite progressing quick enough for Intel (specifically, the unit Intel Digital Home Group). The market for OTT and connected TV is close to being fully developed. What's essential is technology that works well, and that is regularly missing. To see what this is like, they could talk for example to Telecom Italia, which has had to delay several times already the launch of the Cubovision box announced last year.
There's also the possibility of a collision with another group in Intel, Intel Embedded & Communications Group, which supplies its chip to hardware partners such as Amino and leaves further software development to the partners. Possibly it wasn't going fast enough at this group, and now Intel Digital Home is entering the box market to get more control over the end-device. Digital Home will eventually supply not only the chip and the software (in which the Intel Consumer Electronics Network is involved), but also the assembly of the box.
Conclusion: Intel is itching to deliver on a large scale chips for a new generation of boxes and TVs. By getting more closely involved with the production, the company is hoping for a breakthrough.
Concluderend: Intel staat te popelen om op grote schaal chips te leveren voor een nieuwe generatie boxen en TV's. Door zich nu sterker met de productie daarvan te bemoeien, wil het zorgen voor een doorbraak.
