Intel is no slouch when peering into the mid-term to long-term future. It has a proven track record of doing this adeptly. Its very survival depends on it. That is why it is no surprise to see the chip giant swapping WiMAX for LTE. However, the LTE Intel has in mind is not the same LTE that US telecom companies like Verizon and AT & T are implementing. Instead, the far seeing Intel is interested in TD-LTE or time-division-LTE. This is a variant technology used by Clearwire. Most interestingly, this is the standard used by carriers in China. Does Intel see something American telecoms don’t?
Intel and big Chinese telecom equipment manufacturer Huawei have agreed to put up a joint research lab in China to test out TD-LTE infrastructure and silicon components. While these types of interoperability testing deals are quite common and are usually nothing to write home about, this particular deal is worth looking into. It shows Intel’s interest in carving out a new mobile broadband segment for itself. Moreover, it plans to do so in one key geographic market that is exploding: China.
While the China deal is a great step for Intel, it also marks a step backward and recalibration for its initial 4G strategy. Earlier, Intel went all in on the WiMAX standard amidst the heat of the 4G wars and competing standards. Its idea for backing WiMAX is to break the stranglehold telecom companies have on wireless data/phone standards for a more standardized protocol that is friendlier to Intel. It is obvious by now that WiMAX has become an orphan technology. That’s right-Intel bet on the wrong tech horse.
Now that the 4G wars have relatively calmed down, the winners in this technology struggle are becoming apparent. The most obvious winner is LTE. However, it is a particular type of LTE-frequency division duplexing or FDD. Most of the world’s telecoms are embracing this standard except, interestingly enough, China. Why is the rival TD-LTE being championed by the same organizations that had bet on WiMAX (Intel is one of these, obviously)? TD-LTE uses the same unpaired spectrum that WiMAX used.
This begs the question, is Intel making the same mistake again by championing TD-LTE? Is this WiMAX part 2? Why doesn’t Intel just follow the hordes implementing LTE-frequency division duplexing? One possible explanation is that if Intel joins the herd, it will be an also-ran in the chip making end of this standard. As witnessed by its experience with 3G, Intel’s share of the market for the chips for that standard was that of an also-ran Qualcomm dominated that game. Intel does not intend to make the same mistake again. Qualcomm makes almost half of all key radio chips used by mobile phones. This is an extremely lucrative market Intel wants in on and playing second banana is not going to cut it By doing an end run on Qualcomm and hitting the large Chinese mobile market, Intel is possibly preparing to dominate a large market which it can then use as a base to dominate other markets.