Rumor Mill: Samsung to use Intel silicon in forthcoming Android smartphone

According to reports from Korean media, Samsung is planning to release an Android smartphone later this year running on chips from Intel. If the reports prove accurate, the action could represent a significant boost to Intel, which has struggled to break into the market for smartphone silicon. A win with Samsung, the world's largest smartphone maker, would give Intel's profile in the space a substantial boost.

According to Korea's DDaily, Samsung later this year will release an Android smartphone powered by Intel's Atom Z3500 (code-named Moorefield) x86 application processor. According to the publication, Intel's chip sports 64-bit computing capabilities and a quad-core processor, and will be packed with Intel's 3G and LTE modem in the phone.

Further, DDaily reported that Samsung won't run the processor at full speed--2.3 GHz--and will instead run it at around 1.7 GHz in order to prevent the chip from using too much battery power and generating too much heat. The publication also reported that Intel won't make any money on the chip--selling it at less than $7 per unit, or around the cost of production--in order to undercut the price of Samsung's own Exynos processors and get a foot in the door at Samsung.

Representatives from Intel declined to comment and representatives from Samsung did not immediately respond to requests for comment on the rumor.

"This is another sign of Intel making steady advances in the post-PC era," CCS Insight analyst Peter Bryer wrote of the rumor. "Asus, Lenovo and others have introduced smartphones running on an Atom processor, but a Samsung device would provide Intel with heightened popularity among smartphone users. Intel's done much to close the power and performance gap versus ARM chips, but its next battle--to change internal industry perceptions--is arguably harder."

Bryer also noted that Intel has already made inroads with Samsung, powering some of the company's tablets and its new Tizen smartphone, the Samsung Z.

If Intel has managed to gain business at Samsung, the move could represent a challenge to Qualcomm--one of Samsung's primary third-party silicon providers.

According to research firm Strategy Analytics, Qualcomm dominated the global baseband market with 64 percent revenue share, followed by MediaTek with 12 percent revenue share and Intel with 8 percent revenue share.

Intel for the first time broke out the financial results of its Mobile and Communications Group, which houses its wireless chip business, and the numbers were not pretty. The unit in the first quarter had an operating loss of $1.78 billion in all of 2012 and $3.15 billion in all of 2013. In the first quarter of 2014 the mobile group had an operating loss of $929 million on revenue of just $156 million. That compares to revenue of $7.94 billion in the first quarter for Intel's PC business.

For more:
- see this DDaily article
- see this CCS Insight post

Related Articles:
Intel banks on wearables as the next big computing platform
LTE baseband market will expand 47% as carrier aggregation drives device replacements, report says
Intel's mobile group lost $929M in Q1 on revenue of just $156M

Article updated June 19 with comment from Intel.

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