Intel’s Push In Autonomous Cars To Expand Its IoT Opportunities

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Learning from its short-shortsightedness in the smartphone market (where it lost out due to its late entry), Intel (NASDAQ:INTC) is determined to be one of the early entrants in Internet-of-Things (IoT), which is touted be the next growth driver in the semiconductor industry. Emerging markets like automotive and robotics are providing a big boost to IoT, and acquisitions and partnerships signed by Intel in the recent past can help give the company a stronger footing in the market. Two recent acquisitions made by Intel are Yogitech in April and Itseez last week. Both the acquisitions take Intel one step deeper in the automotive market, which is fast moving towards smart, connected cars.

Sizing Up The Automotive Opportunity

>> Morgan Stanley estimates that self-driving vehicles could deliver $507 billion in annual productivity gains.

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>> Strategy Analytics estimates that the Advanced Driver Assistance Systems (ADAS) market will increase to $23.6 billion by 2022, compared to approximately $15.0 billion at present

>> 10 million self-driving cars are expected to hit the market by 2020, a CAGR of 134% from 2015 to 2020. [1]

How The Recent Acquisitions Expand Intel’s Current Automotive Offering

Itseez possesses expertise in Computer Vision (CV) algorithms and implementations for embedded and specialized hardware. The company contributes software tuning and integration in many market-leading products, from cars to security systems and more. Intel intends to make Itseez a key ingredient for Intel’s IoT roadmap, and will help its customers create innovative deep-learning-based CV applications like autonomous driving, digital security and surveillance, and industrial inspection. (Read Press Release)

Yogitech is an Italian semiconductor designer specializing in adding safety functions to chips used in robots, self-driving cars and other autonomous devices. Intel plans to put Yogitech’s technology to work in its chips for advanced driver assistance systems, robotics, and autonomous machines in market segments that require functional safety and high performance. (Read Press Release)

Why Intel Is At The Forefront Of IoT

 

To establish a leadership position in IoT silicon advanced logic, Intel has:

>> Made numerous acquisitions (Basic Science, Recon Instruments, Vuzix, Yogitech, Itseez, Arynga, etc.) to significantly expand its IoT portfolio;

>>  Introduced a new generation low-power microprocessors, e.g. Curie;

>> Created a reference platform for easy & quick implementation of IoT solutions; and,

>> Established partnerships with different fashion, fitness and lifestyle brands.  These include: Daqri Smart Helmet and Fossil; TAG Heuer & Michael Kors for smart watches; Opening Ceremony, TAG Heuer & Google to create a Swiss smartwatch; and, Luxottica to manufacture Smart Sun Glasses.

IoT accounts for less than 5% of Intel’s revenue at present, though we forecast the revenue contribution will almost double over the next 5 years.

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Notes:
  1. 10 million self-driving cars will be on the road by 2020, Business Insider, July 2015 []