In recent breaking news, Intel has purchased Alterra, a company that makes programmable chips. Intel bought the chipmaker company out for $16.7 billion, and many are speculating that this bold move will be the first of many to come for Intel.
So far, though, this acquisition is the largest in Intel’s long history and is in line with its goal to do more than just be a “PC Company.” The main reason for this desire is that PCs are slowly dying out, and Intel doesn’t want to die out along with them. This recent venture, certainly goes a long way in proving that the company might just have what it takes to stick around and to move on to bigger and better things.
The key to what Intel plans to do with its new purchase lies in what Alterra is all about. The company is known for creating customizable computer chips that can be used in a wide range of technologies, such as cell phones, business machinery, and personal devices. These chips are produced, in turn, by a Taiwan based company, TSMC, though there are plans to move the manufacturing process over to the United States in the near future. The speculation is that Intel will begin manufacturing along with the use of the chips, combine the chips with their semiconductors, and, in the process, hopefully increase its current market share.
In addition to helping the somewhat-struggling business along, the acquisition will make the company less reliant on PC sales and allow it to move into internet and communications technologies, which are, of course, huge right now. Most higher-ups at the company feel that the acquisition will be the first of many as Intel wields its power and buys smaller, similar companies out.
New internet related developments from Intel are expected to come to light in 2016. In this year, Intel is slated, if all goes according to plan, to release a combined semiconductor and data chip product that would improve performance and pave the way toward even more advanced technological combinations of these two key pieces in the future.
Though things definitely appear to be looking up for Intel as a result of the big purchase, some say that Intel first has to prove its ability to actually integrate the newly acquired company into its own, which will certainly be no small feat. Intel, though, does have some business models to glean advice from since it is far from the first company to acquire a chipmaker. Avago, for example, recently offered $37 billion for Broadcom, and many think that this trend of acquiring chipmaking companies or integrating in-house companies will follow for a wide range of struggling PC companies and other technology companies.
It will certainly be exciting to see what the future brings, and for now, investors, potential investors, and curious consumers are all watching and waiting to see how things unfold for Intel and what it will mean for the industry as a whole.
- Deals Profit
- January 11, 2015
- 0 Comment