Intel (INTC) looks like a company that we may not recognize five years from now. With the new CEO and the transition into chips for tablets and smartphones, this is only the beginning. The company will start focusing on new technology and also explore new markets that it has not been in to help generate its multibillion dollar revenue stream in the future. Let's take a look at some of the journey that we will experience with Intel in the near future.
Brian Krzanich Says Move to Mobile will be Quick
The new CEO says that the company is focused on accelerating its move into the mobile chip market. Intel has found it a bit hard to move into the land of Qualcomm (QCOM) and the $85.4 billion mobile chip market.
Mr. Krzanich was appointed as the new CEO this year but has been with the company since 1982 starting as a process engineer. As is always the case, there were investors who were hoping for an outsider, as the new CEO who would create some aggressive moves to help the company catch up with the likes of Qualcomm, so Mr. Krzanich's appointment did ruffle some feathers.
His greatest challenge will be to help Intel find ways to move beyond the traditional computer industry. We already know about the mobile industry, but he will also have to help them move into other fields such as home media or wearable technology. While we have smartphones and tablets today, the new CEO will move past present trends and focus on products of the future for the company's chips also.
Revisiting Intel's Plan on Taking over the TV Market
In February of this year, Intel announced the formation of a "media division" within the company because it has plans to sell services to the big screen in everybody's living room. Intel is moving into big media; a chip maker moving in the big media? I can understand other companies that I've read about and you probably heard about like Apple (AAPL), Google (GOOG), and Microsoft (MSFT) wanting to journey into that arena because they see a huge payout possible, but a company like Intel is a surprise to me.
Intel has always been an innovation leader and it does make sense that it would venture out into a new area to create a new source of revenue. The company is serious as it boasts a 300 member TV team with some innovative technology already.
- There is a front facing camera for viewer suggestion depending on who's watching TV at the time.
- A cloud-based DVR lets viewers scroll back in time to watch something without having to record it.
This all sounds nice and innovative, but new and better technology is not the problem with this industry. There is something far greater that Intel has to face.
The "live content licensing deals" are a nightmare to negotiate, especially when they're meant to be groundbreaking. The major media companies like Disney, MTV, and Time Warner own many popular shows and channels. These media giants like to combine the popular and unpopular channels together into one price, and to change this would be quite a war. The large tech companies dream about innovating how we sit in front of the TV and view our shows, but the chance of success at changing the way the media giants bundle things together is like wishing for a cold day in hell. This is one of the main hurdles that Intel has to face, just like the other large tech companies interested in this multibillion dollar industry in the United States.
This industry is huge. There is no doubt about it, and it is a viable option for the chip maker to move into because of the multibillion-dollar revenue streams that are potentially available.
- The global hardware market will generate around $40 billion in revenue by 2014.
- Subscription revenue by Comcast was $63 billion.
- Subscription revenue by Time Warner's cable was $22 billion.
With Intel's STB and service, they will have a direct connection with consumers and have the opportunity to develop their consumer hardware, software and service platforms for everything from phones to tablets to PCs and TVs. It's hard to argue that the potential is there!
These are examples of areas where Intel plans to move into with its new CEO and the next generation of chip it will release soon. Mr. Krzanich has broad experience in manufacturing technology, and this bodes well for where Intel is at the present. It has always shown that it can execute easily and has had a strong technological and market position. If anybody could help the company make the transition that it has been wrestling through, it would be him.
New Chip Competes with Tablet Battery Life
When I am taking long airplane flights, one of the things that have irked me is my laptop battery life that lasts about three hours. Thank God I am reading about Intel soon coming out with a chip that boasts a new battery life of up to nine hours. This will be the fourth generation chip for the company named "Haswell" in products with the chip will be launched beginning of June. The chip will enhance graphics and media performance as well as bring in this longer battery life that will be able to compete with the likes of tablets that have much longer battery lives.