With its new Atom platform launched at CES, the world's biggest chip maker is looking to finally crack the smartphone market at the low end.
With its new Atom processor platform, launched last week at CES, Intel Corp. is aiming directly at the rapidly growing market for low-end smartphones in developing countries.
Targeting the low end of anything seems a decidedly un-Intel thing to do. But Intel has been trying to expand its minimal presence in the smartphone world for several years. Gotta start somewhere.
"By targeting the low end, Intel can attempt to address the market with the greatest opportunity for growth in the smartphone business during the next few years," said Francis Sideco, senior principal analyst for wireless communications at IHS iSuppli, in a report circulated Wednesday (Jan. 16). "With Intel now holding a negligible share of the global smartphone applications processor market, the company appears to be taking the steps it needs to in order to have a chance at expanding its presence in this segment."
Mike Bell, vice president and general manager of Intel's Mobile and Communications Group, shows off a smartphone reference design at a media event prior to the opening of CES. The reference design, based on Intel's new Atom platform, is aimed at emerging markets.
According to IHS (El Segundo, Calif.), the new Atom platform, formerly codenamed Lexington, has an opportunity to tap into a major trend. In developing nations, where there is often a scarcity of wireline phone infrastructure, consumers are hungry for low-cost smartphones that offer high performance and a full feature set.
In most of the world, a smartphone remains a relatively pricey item. Even so, total smartphone shipments in 2012 probably ended up at somewhere between 600 million and 700 million units. When you consider the number of people living in developing nations that could benefit greatly from a low end smartphone with a pretty robust feature set, it's pretty clear that the volumes involved could get pretty enormous pretty quickly if the right price point is hit.
According to IHS, shipments of low-end smartphones—the fastest growing segment of the smartphone market—doubled between 2012 and 2016. The firm expects low-end smartphone shipments to rise to 559 million by 2016, up from just 206 million in 2012.