Intel Moves Beyond PC Market, Dives Head-First into Wireless

Aug. 30, 2010
Buys Infineon wireless unit for $1.4 billion, focusing on high-growth smartphones chips.

In a move aimed to make wireless connectivity a central core of its business, chip manufacturer Intel is acquiring the wireless business of the German chip maker Infineon for about $1.4 billion in cash.

The Infineon unit makes chips used for laptops, netbooks and smartphones, including the Apple iPhone, and will vastly strengthen Intels wireless lineup.

"The global demand for wireless solutions continues to grow at an extraordinary rate," said Intel chief executive Paul Otellini in a statement. "The acquisition of Infineons WLS (Wireless Solutions) business strengthens the second pillar of our computing strategy -- internet connectivity -- and enables us to offer a portfolio of products that covers the full range of wireless options."

The purchase is another signal that Intel is intent on moving beyond the personal computer market, which has badly struggled in recent years. Just two weeks ago, the company bought security software maker McAfee for $7.68 billion.

This acquisition, however, focuses entirely on giving Intel a strong foothold in the market of smartphone chips -- an area that is seeing powerful growth. According to research firm Gartner, smartphone sales in the second quarter of 2010 rose 50.5% compared to a year ago.

Intel's deal with Infineon still requires regulatory approval and is expected to close in the first quarter of next year.

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