Intel Launches New Platforms & Partnerships To Accelerate The Development of 5G

It is well known that Intel (NASDAQ:INTC) commands a lions share of the PC and Server processor markets, having been the leader in both for over two decades.  Yet the company missed out on the mobile computing revolution, and as a result has a negligible presence in the market. The company failed to see the potential of the ARM-based processors that power the majority of the mobile phones today. Intel invested heavily on WiMax, a 4G technology that lost out to the LTE ecosystem. However, it looks like the company has learnt from its past mistakes and is going all out to gain a wide presence in 5G. At the ongoing Mobile World Congress (MWC), Intel detailed its 5G plans and a number of industry collaborations to accelerate the development on 5G.

What is 5G?

Based on the 802.11ac standard, 5G is a blanket term for a host of new technologies being developed to enable significantly faster wireless networks. 5G is the next generation wireless technology, which has the potential to be 10–100 times faster than today’s LTE networks. ^[1] That’s a huge leap forward.

With ushering in of the Internet-of-Things (IoT) revolution, there will be millions of new connected devices on the network. The installed base for IoT devices is estimated to grow from around 10 billion connected devices today to as many as 30 billion devices (or 50 as per some estimates) by 2020.  Intel sees 5G as the core to creating a “network revolution” that will allow the growing number of connected devices to reach their full potential. The company is of the view that the technology could hit the market by 2018, much earlier than its anticipated launch in 2020.

New Intel Platforms To Accelerate The Deployment of 5G

Intel believes that it is uniquely positioned to usher in the 5G era with end-to-end solutions that integrate intelligence across the network, from the data centre to the connected device and all systems in between.

At the 2016 MWC, Intel announced new  industry partnerships and products that lay the groundwork for faster, smarter and more efficient 5G wireless networks. The company introduced a new 5G platform for faster prototyping, which offers a high-performance development platform for faster integration and testing of 5G devices and wireless access points. The company launched a range of modems and system-on-chips (SoCs) which provide robust connectivity for IoT, mobile devices and PCs. Five solutions are aimed specifically for IoT devices such as connected cars and wearables, and the Intel XMM 7480 specifically targets mobile devices and PCs. Intel also announced partnerships with Ericsson, KT, LG Electronics, Nokia, SK Telecom, Verizon, AT&T, Huawei, and ZTE to collaborate and to help test 5G technologies. (Read Intel Press Release for the complete list)

Intel currently derives less than 5% of its revenue from IoT, and we estimate the segment to account for close to 10% of the company’s total revenue in the next 5-6 years.

Our current price estimate of $33 for Intel is at a more than 10% premium to the current market price.

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1. Intel goes all in on 5G in a bid to get back into mobile, Android Authority, February 22, 2016 [↩]