Monday, March 11, 2013

Intel's next President can make agreement with Apple

The next Chief Executive of Intel should drive the world's largest manufacturer of chips for custom production segment, a strategic turn that could result in agreement with Apple and give the company the real chance of advancing in the mobile market.
Manufacture custom chips from other companies would be a major change for Intel, which for decades based their businesses on the use of industrial competence to offer its own project, and chips than rival products, for use in computers.
With the contraction in sales of computers and since some of its factories are operating below capacity, the chip maker believes that there is an opportunity to put to use their idle production lines and get a new source of revenue.
The decision could also represent a kind of back door for large-scale production of chips for mobile devices, a segment in which Intel scored major breakthrough after underestimating the impact of the iPhone and iPad, which left behind more nimble rivals.
Intel announced last week that it would hire their exclusive production technology to manufacture chips designed by rival Changes, winning its first customer in outsourced production segment, which must grow.
This spawned rumors about a deal with Apple. A source familiar with the two companies said that Intel and Apple executives discussed the subject in recent months, but that has not reached an agreement.
"If you can have a strategic relationship in which produces chips for one of the big mobile companies, is something you should definitely consider. And to Apple an agreement like this would be great advantage, "said Pat Becker Jr., Becker Capital Management, which owned about 39 million dollars in shares of Intel at the end of last year.
Intel's plan involves heavy capital investment, even if she is finding difficulty in its primary market and has not found enough demand to keep occupied factories planned for the future.
Also would mean joining the outsourced production industry, which depends on volume to propel the business and therefore is highly vulnerable to upsets in the economy and would force Intel to accept a reduction in its profit margins, the best in the industry.
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