Is Intel’s Medfield the Beginning of the End for ARM?
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There is little doubt Intel (NASDAQ: INTC) is aiming for a come from behind victory in the mobile computing space currently dominated by ARM Holdings (NASDAQ: ARMH). ARM has had a competitive advantage in this space for what feels like forever, their chips by nature are more power efficient, making them more suitable for mobile designs. Thanks to a little help from our old pal, Moore’s Law, the sands have begun shifting in Intel’s favor. With Intel’s introduction of its Medfield line of 32nm mobile processors, they are beginning to gear up for serious battle in the mobile space. I’m sure by now they have ARM’s attention.
Two years ago, Intel announced its Moorestown chip platform as part of their mobile initiative, which completely unraveled into an epic failure. Fast forward to today, Intel has licked its wounds and advanced their mobile ambitions in a more promising and focused direction. At CES 2012, Intel announced the Atom Z2460 system on a chip (SoC) – Medfield – which made its debut into a smartphone last month, the Xolo X900. That’s a first for Intel and its x86 architecture, even though it’s their second attempt.
Medfield vs. Moorestown
Medfield is not Moorestown, in that it actually made its way into a consumer product, the latter did not share that success. Moorestown was essentially a two chip solution (65nm and 45nm) before manufacturers had the joy of adding a Power Management IC (PMIC), WiFi/3G radio, and external ram. For those keeping track at home, that’s five chips to make Moorestown work. And you wonder where they got the name Moorestown from?
Thankfully, Medfield has improved upon this and dropped the total number down to three and runs on a smaller 32nm process (smaller is better here); outside of a Medfield, all you need is a WiFi/3G/LTE radio and a PMIC to get the party started. That’s 40% less chips draining power in two years time, not to mention the size of the transistors are 28-50% smaller.
In terms of strategy, Intel has changed their approach completely since Moorestown. For one, Intel is no longer pushing MeeGo, their now extinct mobile OS, which they dropped last September. Instead, Intel has backed Google’s (NASDAQ: GOOG) Android by contributing to its development to ensure their chips can remain compatible with the software platform. This is a plus for Intel because now they do not have to sell manufacturers on the idea of creating x86 compatible software from scratch. The new strategy appears to indicate positive reception because Intel has announced multistage deals with Motorola (NYSE: MMI) and Lenovo (NASDAQOTH: LNVGY.PK), which will include smartphones and tablets; we should start hearing more about these products in the coming months.
The Skeptic's Flaw
Skeptics will call out the fact that Intel is still behind next generation ARM technology, which is 100% true; Medfield is not as compelling of a solution as a leading 28nm ARM chip from Qualcomm (NASDAQ: QCOM), Samsung, or Nvidia (NASDAQ: NVDA). The flaw within this argument is that it overlooks Intel’s goal with Medfield, which is to get their foot in the door and get some exposure in the mobile chip space. It’s more important for Intel to get their brand out there, than it is for Medfield to be a homerun. Come future generations, Intel will become more and more competitive as their chips continue to shrink. I expect when their next generation 22nm process due next year and 14nm due the year after, things will start getting serious.
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