Very well put. Provides the right perspective, and correctly mentions that there is no guarantee for Intel. It is now playing a catch up game, and it does not know which way to run. It does have a direction now, but it will not be able to compete with people who have the bearings!
Strategic musings aside, have you notices that Intel has not been able to develop a new line of business since they got out of DRAM?
Being a in monopoly, Intel people cannot function in a competitive market environment. Further more, buying a new business that is less profitable than the microprocessor will always lead to internal resource allocation problems. Unless the profit can look good compared to microprocessor in 2 years, they will be thrown out as usual.
It is interesting seeing a company try to diversify. Their dominance in one market does not mean sucess in another. No matter what other market they try to expand in, it will always take second fiddle to the PC processor market. If they don't allow another part of the company to have enough priority to grow, it will wither and die.
There are so many giants that fail to diversify from the dominated market. Although, over the last 20+ years, we have experienced success story from various companies which include Nokia and Apple. There are indeed a lot to learn and adopt from the current team to the new market. I agree with Daleste that "If they don't allow another part of the company to have enough priority to grow, it will wither and die." What else is necessary to make the transition to be successful?
@ daleste & chanj
I would say Intel's acquisition is more on the lines of saving their core CPU business from ARM's attack rather than diversification. Wireless chipset business is highly competitive in itself & profit margins are low compared to Intel's CPU business.
The reported purchase of content in a segment that is certainly thriving and growing is, and will be, an interesting study for both companies involved. I suppose the impact of the decision, upon both parties, will take quite some time to play out.
In ten years, Intel will be history in all these news acquisitions. They will be out competed. If you take their market bully, Intel loses bite. I hope this works for them. Buying McAfee and Infineon division does not guarantee success when they have not moved stocks for ages despite dominating the chip market.
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