Intel is meekly backing off from the very difficult TV system-on-chip market as Google TV failed to sell. Now, the resources it had invested in TV SoCs will be put into chips for mobile devices, specifically smartphones and tablets.
Intel has so far failed to throw its substantial weight to much success in the TV SoC market.
According to analyst house IHS, actually, the space has been dominated in 2011 so far by Taiwanese companies, Mstar Semiconductor which held 39 percent of the market and MediaTek which had 12 percent. Trident, based in the States, had six percent of the market.
Intel, along with other new entrants into the market, held up just two percent of the market as seen in the chart below.
Captive suppliers like Samsung, Toshiba and Sony - so vertically integrated manufacturers - make their own chips to put in their own televisions. Independent players, like Zoran, says IHS, made up 14 percent of market share.
Randy Lawson, principal analyst for display and consumer electronics for IHS, says Intel had great challenges ahead of it. Perhaps too much was bet on the Google farm, he suggests - saying the slow sales mean it's "no surprise that Intel is moving away from the television SoC market."
Intel, Google, Sony and Logitech have flopped so far on their Smart TV initiative. Google TV was to be the flagship feature of the interactive, rather than passive, tellly but consumer demand has been poor and involved companies have cut market prices to shift inventory.
There would be plenty of problems ahead for Intel if it wanted to carry on with TV SoCs. Firstly, IHS is expecting exactly zero growth this year for flat panel TV semiconductor market revenues thanks to weak end-market and consumer demand.
The television market in general is stuffed in the near term. Broadcom, for example, has announced it doesn't fancy hanging around for the TV video processing chip market to hot up, while Trident thinks a decline in set top box and TV semi sales means it needs to slash its workforce by 20 percent.
The logical step, according to IHS beancounters, is for Intel to focus on mobile consumer electronics devices, especially in video processing. As the devices increasingly adopt HD TV technologies, like image scaling, frame rate conversion, noise and artifact suppression, if it acts quick Intel has a chance. It would also be well placed to help bridge the gap with convergence between TV and portable media devices.
IHS believes that smartphones and media tablets are going to totally leave TVs in the dust, as far as their place in consumer electronics stands.
Resources industry-wide are expected by the analyst house to shift towards smartphones and tablets.