Intel Buys Its Way Deeper Into China

Although Intel is the world’s leading maker of chips for PCs and servers, the company has long struggled to land a significant piece of the mobile market, where Qualcomm dominates. Last year, Intel took in $55.9 billion in revenue, up 6 percent from the previous year; its mobile division accounted for $202 million. It may well be too late for Intel to catch up in the U.S. or Europe, where just about everyone who’s going to buy a smartphone or tablet already has one with a rival chip inside. So instead of battling for the next iPhone contract, the company is pouring billions of dollars into expanding its influence in China, where fewer than half the country’s roughly 500 million mobile phone users have smartphones.

Intel, which doesn’t break out mobile earnings figures for China, has a long way to go before it’s a serious force in the country’s mobile market. Qualcomm chips are in most high-end phones, including those from Chinese leader Xiaomi, and Taiwanese company MediaTek controls the cheaper end of the market. At this point, the chip market in China is a duopoly, says Mark Hung, an analyst at researcher Gartner. Even if Intel reaches third place, “No. 3 is probably meaningless.”