Here's Why Asus May Survive Intel's Telephone Commutation Smartphone Partner
Anybody familiar alongside the PC infinite knows that ASUS is ane of the most trusted brands for PC motherboards, monitors, graphics cards, together with notebook/desktop computers. Its products are competitive, reliable, together with perform well. It's a advert that's trusted past times many and, equally a result, it seems that equally Intel continues its force into ultra-mobility, ASUS volition endure a prominent thespian together with maybe a key driver to potential success for Intel inwards this market.
The ASUS ZenFone is a corking get-go step
At CES, ASUS announced a business of smartphones known equally the ZenFone lineup. These are incredibly company phones that -- for the shout for prices -- should create quite good inwards markets where LTE is non currently widespread (these phones utilisation Intel's XMM 6360 modem, thus 3G only). They are powered past times Intel's Z2500 menage unit of measurement of Atom SoCs together with compared to its peers inwards the $99-$199 unsubsidized toll range, the functioning is at to the lowest degree equally skillful equally what competitors are shipping, if non better.
According to Digitimes, ASUS plans to sell nearly v ane G 1000 of these ZenFone products during 2014, making ASUS Intel's largest smartphone processor customer. The destination for 2015 is 10 ane G 1000 units, or nearly double 2014 levels. From a revenue standpoint, it is unlikely that Intel is generating much; inwards fact, it wouldn't endure a surprise if these processors required contra-revenue to offset a high pecker of materials relative to other inexpensive smartphone flake solutions. That said, this gets Intel inwards the door.
Is this a potentially fruitful multiyear partnership?
At Mobile World Congress, Intel announced a multiyear, multidevice partnership alongside ASUS. Intel mobile executive, Hermann Eul, indicated that ASUS together with Lenovo had both signed on for such partnerships together with that these partnerships would bridge phones together with tablets utilizing Intel's entire portfolio of products.
Intel's Tangier SoC, utilisation of the Merrifield platform, is shown on the right. Source: Intel.
Now, piece ASUS is no Samsung, the partnership hither couldn't endure to a greater extent than obvious. Intel needs to interruption into the mobile marketplace position where it faces Qualcomm , an extremely powerful incumbent. It also faces the fact that Apple, which owns 15% of the smartphone market, designs its ain chipsand also that Samsung -- which designs its ain chips together with builds chips for the likes of Qualcomm equally a foundry -- owns 30% of the market. This leaves but 55% for the residual of the earth (the publish is truly smaller equally Huawei designs its ain silicon, too).
Intel's project is to cook companies similar ASUS strong
Intel isn't going to win this marketplace position past times winning over Apple or Samsung, thus what it does demand to create is to construct upward unopen to of these smaller friends from the PC marketplace position to endure formidable players. If the likes of ASUS, Lenovo, together with fifty-fifty Acer (which truly dumped Intel's chips inwards phones for 2014, but could endure dorsum inwards 2015 when Intel's production portfolio improves) could endure made into formidable Samsung alternatives, together with thus Intel could all the same win that way.
How does Intel create this? Well, ASUS (among others similar ASUS) select to the tabular array company engineering prowess together with established consumer brands. Intel volition endure able to select company silicon equally good equally a major international cook to the table, helping these smaller players to a greater extent than effectively struggle Samsung together with Apple. This isn't something that'll endure slowly given the electrical current set down of the market, but Intel has invested likewise much inwards mobile to non force every lever it tin to gain share.
Foolish bottom line
With the ZenFone, ASUS together with Intel showed that they could position together a truly compelling low-end yell for cost-conscious markets. However, this partnership is probable to extend much farther together with it wouldn't endure a surprise to encounter unopen to higher-end phones transportation inwards the U.S. built past times ASUS this year. ASUS isn't a Samsung, but there's no key argue why ASUS can't accept a large slice of Samsung's smartphone pie alongside Intel backing it -- assuming, of course, that Intel gets its mobile-chip story straightened out.
Are smartphones quondam news?
If y'all idea the iPod, the iPhone, together with the iPad were amazing, but await until y'all encounter this. One hundred of Apple's tiptop engineers are busy edifice ane inwards a surreptitious lab. And an ABI Research written report predicts 485 ane G 1000 of them could endure sold over the adjacent decade. But y'all tin invest inwards it correct now... for but a fraction of the toll of AAPL stock.
Source: http://www.fool.com/investing/general/2014/04/23/why-asus-may-be-intels-key-smartphone-partner.aspx
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