Intel talks up 3G cell phone chip, new partners

Intel Corp. disclosed its plans to release an integrated cell phone processor for 3G networks during president and chief operating officer Paul Otellini’s keynote address Wednesday at the 3GSM World Congress in Cannes.

The new family of processors is code-named Hermon, and builds on Intel’s integrated processors for Global System for Mobile Communications/General Packet Radio Service (GSM/GPRS) and Enhanced Data Rates for GSM Evolution (EDGE) networks. Hermon processors will support faster Universal Mobile Telecommunications System/Wideband Code Division Multiple Access (UMTS/WCDMA) 3G networks and will also allow phone users to participate in videoconferences, Otellini said during his speech.

Hermon will feature the same XScale processor core as Bulverde, the next generation of processors for personal digital assistants and cell phones due in the first half of this year, said David Rogers, wireless marketing manager at Intel. However, it will not come with the Wireless MMX (multimedia extensions) technology that will allow Bulverde phones and PDAs to handle high-end video applications, he said.

The Hermon processors also have a lighter version of the camera phone technology found in Bulverde, Rogers said. PDAs and phones with Bulverde will be able to take as high as four megapixel pictures, while Hermon phones will be limited to around two megapixel pictures, he said. That resolution is still better than many camera phones on the market today.

Intel processors are relative newcomers to cell phones. The Santa Clara, Calif., company’s PXA800F processor, formerly known as Manitoba, was released about a year ago as its first attempt at cracking this market. The PXA800F features an XScale applications processor, a GSM/GPRS modem, and flash memory integrated onto a single chip.

Right now, many phone designers use two chips from companies like Texas Instruments Inc. (TI) to separately control the operating system and the communications because the chipsets are easier and cheaper to build into phones than the single chip. Intel believes that a single-chip approach allows phone designers to build smaller devices and that costs will decrease as silicon technology continues to shrink.

TI also sells integrated chips, but mobile phone manufacturers have so far preferred the multiple approach. The Dallas company unveiled its new OMAP2 architecture earlier this week at 3GSM that is expected to improve the performance of smart phones and camera phones. The new architecture will be incorporated into both stand-alone applications processors and integrated chips.

The Hermon chips were developed in partnership with TTPCom Ltd., which makes the software that controls Intel’s processors.

Intel announced Wednesday that manufacturer Asustek Computer Inc. will build phones based on the PXA800F and smart phones based on the Hermon processors. Wireless carrier Orange SA will also work with Intel on next-generation phones, Intel said.

Both Asustek’s PXA800F and Hermon phones will be available by the end of 2004, the company said in a release. Asustek is the first partner that Intel has signed to produce Hermon phones, it said.

Not many companies have signed on to build phones with Intel’s PXA800F chip. The XScale applications processor can be found in several phones, but the PXA800F has proved a tougher sell. Maxon Telecom Co. Ltd. agreed last year to release a phone in the fourth quarter of 2003 based on the chip, but that phone has yet to hit the market.

In December, Intel wrote off US$600 million in goodwill related to its cell phone processor division, saying the business would not grow as quickly as it had once believed. Goodwill measures intangible assets, such as a brand name, that lack a specific cash value but potentially increase a business’ earning power.

“Intel has a lot of strengths in packaging and combining memory with logic, and has also just started to talk about its Carbonado 3D graphics coprocessor, so they have potential to grow in wireless. The issue so far has been executing in baseband and providing a complete lineup,” said Allen Leibovitch, an analyst with IDC in Mountain View, Calif., in an e-mail interview.

Carbonado is Intel’s code name for a planned graphics processor that would improve the performance of games and multimedia applications on handheld devices, much the way graphics processors from ATI Technologies Inc. and Nvidia Corp. improve the performance of PC graphics.

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