New Intel CEO Needs Mobile Roadmap

Can Intel go from being king of the PC market to a master of mobile? A fund manager and an analyst tell us what three steps the incoming CEO needs to make. Carmen Roberts reports.

Published

7 months ago

Categories

Technology, Finance

Topics

Computers, Finance

People

Carmen Roberts, Paul Otellini, Vijay Rakesh, Joshua Spencer

Companies

Qualcomm Incorporated, Intel

Transcript

PLEASE NOTE: THIS EDIT CONTAINS CONVERTED 4:3 MATERIAL Three big changes at Intel: CEO Paul Otellini is stepping down in May, PC demand is weakening, and the industry is shifting toward mobile computing. So, can Intel go from being king of the PC market to a master of mobile? The answer may lie in being more aggressive in manufacturing and mobile. Joshua Spencer, portfolio manager of the T. Rowe Price Global Technology Fund, sees two important steps for the chipmaker. SOUNDBITE: JOSHUA SPENCER, PORTFOLIO MANAGER, T. ROWE PRICE GLOBAL TECHNOLOGY FUND (ENGLISH) SAYING: "One would be to continue to push the manufacturing advantage and in doing that you wind up with chips that have lower power consumption as well as better power performance. And those chips can be more compelling for smartphones and tablets." The second step would be for Intel to integrate its processor chips, the CPUs, with cellular chips. That would let Intel play catch up with Qualcomm. If the chipmaker wants to crack the mobile code, it needs to lay out a clear plan of action - according to Vijay Rakesh, semiconductor analyst at Sterne Agee. SOUNDBITE: VIJAY RAKESH, SEMICONDUCTOR ANALYST, STERNE AGEE (ENGLISH) SAYING: "They have to lay out a roadmap on the handset side with 3G, 4G, how they expect to take share. What's their strategy on the handset side? What's their roadmap to integrate next generation protocols? What's the pricing structure? How are they going to get into China?" With $3 billion in free cash flow a quarter, Rakesh says it's much too soon to write Intel off. And the company's design expertise may entice mobile device makers to create products based on Intel's chips. But even if that fails to happen, Intel could still manufacture other company's chips. SOUNDBITE: JOSHUA SPENCER, PORTFOLIO MANAGER, T. ROWE PRICE GLOBAL TECHNOLOGY FUND (ENGLISH) SAYING: "I think Apple fabbing their chips at Intel could be a match made in heaven." Even with such a match, Spencer says Intel will never fly as high as it did when it ruled the PC industry.