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Collateral damage from Intel's DTV decision

October 14, 2011 // Junko Yoshida

Collateral damage from Intel's DTV decision

So, who are the unsuspecting victims of Intel Corp.'s plans, publicly disclosed this week, to “wind down” its digital TV SoC business? Rick Doherty, co-founder and director of Envisioneering Group, identifies the real victims as “more than 20 Chinese ODMs, all hoping to ride Google TV's coat tails.”

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These companies were developing add-ons to LCD display units for Google TV. They were getting lots of help from Intel to prototype [them], and approach U.S. and global retailers, said Doherty. They were all headed for a CES 2012 launch.

Meanwhile, when asked which part of the CE business Intel is getting out of, an Intel spokesperson said: the retail [digital TV] business. While adding that Intel will continue to work with a few partners on a case-by-case basis, she declined to name names of such partners.

For Intel, ditching the digital TV SoC business was a tough decision, but it creates a clear path to align its consumer business with Ultrabook devices, smartphones and tablets, which the Intel spokesperson now describes as top corporate imperatives.With this decision, Intel no longer needs to get caught up with, or getting distracted by, what might turn out to be fierce price competition on the digital TV SoC market.

Intel is now wisely shifting its CE silicon strategy to the gateway and IP set-top-box media processor businesses. Meanwhile, the company will wind down its operations in the Digital TV business, the spokesperson added.

So, what's left of Intel's CE business? The IP set-top media processor business and the gateway business, says Intel. These remaining CE businesses will be folded into Intel's tablet organization headed up by Doug Davis. By IP set-top media processor business, Intel means SoC silicon and hardware designed for high-quality digital set-top boxes where content delivery is via IP networks.

Clearly, Intel's primary focus is on IP networks. Forget about traditional terrestrial, satellite or cable broadcast technologies.In the gateway (also known as cable) business, Intel will continue to build SoC silicon and software for cable modems, cable gateways, Fiber-to-the-home gateways, retail IP gateways, and multimedia terminal adapters.

The cable modem technology Intel acquired from TI, for example, belongs to this gateway business category, and will be part of the expanded charter of the Netbook and Tablet Group under Doug Davis, explained the Intel spokesperson. Doherty suspects that almost every major TV maker, Sony, Samsung, LG and Vizio included, who started with Intel SoC chips for their Google TVs, are now likely to pursue ARM-based solutions for TV screens.

Intel's 4200 series SoCs, which were on display as recently as the Intel Developers Forum last month, according to Doherty, are the ones most likely to be wound down.What about so-called synergies between tablets and Intel's remaining CE business? Doherty said, Intel could discount these CE 4200 SoCs for tablets...but they are still power- hungry.

How Intel might succeed in the tablet and IP TV delivery segments is far from clear. Intel is starting years after NVidia, Qualcomm, Apple A5, even Marvell (they are in $299 Vizio tablet) and other ARM core solutions, Doherty observed.

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