Intel Corp. is gaining a foothold on the mobile chip market but its position could still be shaky, according to some industry analysts.
With the slowing PC sales due to growing tablet and smart phone adoption, the chip maker switched its manufacturing focus from computer-focused chips to smaller less power-hungry processors that could be embedded onto mobile devices.
But even if the company’s 4th generation Haswell quad core processors corner a sizeable piece of the mobile market, Intel may still face dwindling revenues this year, according financial services firm J.P. Morgan.
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While Intel has shown gains in the tablet market “expected shipments are too small to offset declining demand in notebooks,” according to a report from J.P. Morgan.
Rival chip maker ARM Holdings still dominates the mobile chip market.
The average price of a tablet chip is $25 to $30 compared to the $110 that notebook chips fetch.
Financial research firm Bernstein research the risk Intel faces is “extremely high” because Intel’s mobile chips are selling for a third or a fifth of its notebook processors.
Intel currently owns less than two per cent of the mobile chip market, according to Nathan Brookwood of market consulting firm Insight 64. He said Intel needs to corner as much as 10 to 20 per cent of the market to sustain growth.