Intel looks to China for mobile, tablet catch-up

Intel continues its tablet push. Despite a delay in announcements and general hushed voices over its strategy in the mobile device market, with yesterday’s Oak Trail confirmation – where it talked up Cedar Trail instead – Intel is keen to establish itself as a player in the sector.

And so it announces a joint research centre with Tencent Holdings in China, where the two will partner on developing technologies and services specifically for tablet and mobile. The idea is to capitalise on China’s intensely competitive market where many Western companies cannot gain a firm hold.

China’s Tencent is a public company which provides internet services particularly in the country. Intel will piggy-back the firm to establish and develop specifically targeted hardware for the region. It’ll be Intel’s job to look to the hardware and operating systems – Tencent will tap into its experience by working on services and user experience for joint projects, reports the Wall Street Journal

Whether leaving Intel to the operating system is a good idea or not remains to be seen. It is unwaivering in its dedication to the uncertain MeeGo. But it is touted as a very open OS and it may be just the ticket for specific market customisation.

The research centre will see 60 engineers from both companies working together, at first, but they hope to swell that number to 200. Eventually they’re aiming to spread the focus out into PCs, TVs and vehicles, too.

Meanwhile it has been reported  Intel has been designing phones for ZTE using the Atom chip. There are other whisperings that the two will collaborate further on outsourcing and design. It would be an interesting pairing: ZTE pursues an aggressive strategy aimed at low price-points and the wider market and is already penned in to be a major player in Western markets over the coming years. It is just about the biggest in China, currently.

Intel may have realised it has missed the boat on rushing out its chip in consumer electronics in the West. But for it to focus on the high-growth Asian markets could be a wise strategy where it can really capitalise. The problem is convincing potential partners not to rush to ARM.

Then again – the Chinese state thinks otherwise. A top official recently said the eventual aim is to use Chinese chips globally, undercutting the competition on price and output, in a similar way to every country in the world uses Chinese textiles.