To acquire more tech assets, GSR Ventures is raising $5 billion. (Photo : www.cloudfront.net)
Intel Corporation CEO Brain Krzanich is expecting its new semiconductor partners in China to use Intel's architecture for tablets and smartphones instead of the ARM technology from Britain.
Intel signed a deal with Spreadtrum and Rockchip, semiconductor firms respectively based in Shanghai and Fuzhou, stating that the two companies will start using Intel's technology in a few years to join the rapidly growing Chinese market for low-cost tablets and smartphones.
Currently, the semiconductor companies utilize the licensed technology of ARM Holding Plc.
According to the deal, Intel will not be restricting the firms from manufacturing ARM-based chips. However, Krzanich said that the Chinese partners will switch to Intel's architecture within two to three years.
Spreadtrum and Rockchip are collaborating on making "system on chips" or SoC tablets, with Rockchip developing graphics and connectivity features.
Intel recently acquired 20-percent shares from Spreadtrum for $1.5 billion. The latter is cooperating with Intel in making SoC tablets slated for release in 2015.
Krzanich said that both the Chinese firms lack resources to develop their own separate chips based on ARM and Intel technology.
According to Krzanich, Intel's advanced technology will boost its partners' brands to compete with mobile chip manufacturer leader Qualcomm Inc., which uses ARM-based top-line chips, and MediaTek, a Taiwan-based chip maker specializing in affordable ARM-based mobile chips.
The Intel CEO said that small firms face fierce competition. The tech giant is currently focusing on the development of its technology for smartphones and tablets. Intel is known for its high-end computer processors, but not in the low-end SoCs, which are key parts in the said mobile gadgets.
The U.S. market for smartphones is highly saturated, the reason why smartphone makers are targeting the Chinese market that is showing increasing mobile demands.
"We're not done. China is the fastest growing market in the world," said Krzanich.
