Intel is willing to spend large sums to jump-start new markets, but the numbers that SemiAccurate has heard for one phone deal are simply staggering. The real question that remains is that if this deal is indicative of others, is it all money well spent?
The deal in question is for phones with Motorola, one of the two initial customers at the Medfield/Penwell launch almost two years ago. This partnership had some very tangible results, most notably the Motorola Razr i phone. SemiAccurate has been using one internationally for about a year and we can say without a doubt that more than anything else it convinced us that Intel is providing first class silicon for the mobile industry.
Before you dismiss the impact of a single device like the Razr i, the reputational value of having a tier-1 phone company putting out a first class phone is almost incalculable. Overnight Intel went from a wanna-be to a contender, but the deal still went horribly wrong. Knowing that, did Intel get what they wanted? Was it worth the money? Is this model sustainable for other markets like Quark in IoT?
Note: The following is analysis for professional level subscribers only.
Disclosures: Charlie Demerjian and Stone Arch Networking Services, Inc. have no consulting relationships, investment relationships, or hold any investment positions with any of the companies mentioned in this report.
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