Update: Intel-TSMC Atom partnership on hold

SAN FRANCISCO—Intel Corp. Thursday (Feb. 25)acknowledged that it has no immediate plans to bring to market any Atom chips manufactured by Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC), confirming a report that the groundbreaking partnership announced by the two companies last year has hit a lull.

Earlier Thursday the New York Times reported that the partnership between Intel and TSMC had been placed on hiatus due to lack of customer demand. The report quoted Robert Crooke, general manager of Intel's Atom and SOC development group, saying that the No. 1 chip vendor has not given up on the partnership.

Intel spokesperson Bill Kircos said no TSMC-manufactured Atoms are on the immediate horizon, though he added that the companies have achieved several hardware and software milestones and said they would continue to work together.

"It's been difficult to find the sweet spot of product, engineering, IP and customer demand to go into production," the Kircos said.

Intel (Santa Clara, Calif.) said last March it would port unspecified Atom processor cores to TMSC's technology platform, including processes, IP, libraries and design flows. The deal—the first in which Intel would transfer a processor technology outside to a silicon foundry—was widely seen as Intel's attempt to beef up its presence in the embedded space, where the architecture of ARM Holdings plc dominates.

The delay in moving Atom products into production at TSMC appears signal slower-than-expected progress on execution of Intel's strategy to grow revenue outside of the PC market by pushing its x86 architecture deeper into to the embedded market and elsewhere.

Intel has been trying for years to grow revenue outside of the PC space, where its microprocessors dominate.

Last year the company made a series of moves seen as gearing up for a broader push into new markets—including the TSMC deal, the acquisition of embedded software specialist Wind River Systems Inc. and the $1.25 billion settlement of longstanding legal issues with microprocessor rival Advanced Micro Devices Inc. Placing its partnership with TSMC on hiatus would appear to cast doubt on Intel's strategy to grow revenue by driving its x86 architecture beyond the PC to the embedded market and elsewhere.

Jim McGregor, chief technology strategist at market research firm In-Stat, said placing the TSMC partnership on hold does not mean Intel's x86 will fail to make further inroads into the embedded and consumer markets. But he said Intel's quest will require patience.

"It takes time. It takes a lot of time," McGregor said. "They have to build a relationship and build the product. You can't just flip a switch."
Edition Dylan McGrath


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