Intel buys Internet of Things chipset specialist Lantiq to get into smart home market

Intel struck a deal to buy Lantiq, a system-on-chip specialist focused on broadband access and home networking technologies, in a bid to get more deeply enmeshed in the smart home, one of the leading areas in the Internet of Things market. Financial terms of the acquisition were not disclosed, but Intel said the deal is expected to close in around 90 days.

Lantiq was created in 2009 out of former operations of Infineon that were purchased by the San Francisco investment firm Golden Gate Capital. That deal was valued at about $400 million when it closed, according to the Wall Street Journal. Deutsche Telekom was among the companies invested in Lantiq through Golden Gate, Reuters noted.

Lantiq's chipsets are designed for customer premises equipment and smart gateways aimed at connecting devices to one another in the home. Such gateways and intelligent access networks are important elements in Intel's IoT strategy. The company sees this as a way to broaden its gateway offering to other markets, including LTE and IoT.

"Intel has been a global leader in driving broadband into the home and to connected compute devices," Kirk Skaugen, senior vice president and general manager of Intel's Client Computing Group, said in a statement. "The combination of our cable gateway business with Lantiq's technology and talent can allow global service providers to introduce new home computing experiences and enable consumers to take advantage of a more smart and connected home."

Lantiq CEO Dan Artusi added: "Intel and Lantiq share a common vision about the evolution of the connected home and the intelligent network. Together we can drive the transformation of the broadband customer premises equipment as it becomes a smart gateway that connects an increasingly diverse roster of devices and services in the home."

Although Intel's mobile chipset business has been beset by billions of dollars in financial losses that the company is trying to overcome, its Internet of Things business has been a bright spot. In the fourth quarter of 2014, the firm's IoT business reported $591 million in revenue and an operating profit of $185 million. For the full year, the unit posted $2.14 billion in revenue, up 19 percent year-over-year, and an operating profit of $616 million, up 12 percent from 2013.

In December Intel unveiled an IoT platform designed to serve as an end-to-end reference model to unify and simplify connectivity and security for the IoT.

For more:
- see this Intel release
- see this Reuters article
- see this WSJ article (sub. req.)

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