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Tuesday, June 06, 2006

Computer Business Intel Offers Up Part of its Communications-Chip Business

Computer business Intel Corporation recently put some of its more struggling communications-chip businesses up for sale, including its network processors, Xscale chip lines and some other products. The report was released on Sunday, June 3.

The computer business spent over ten billion to get involved in the communications business, but suffered millions of dollars in losses in the market. This most recent Intel sale is part of Intel’s strategy to completely re-envision the company. The computer business will also lay-off or redistribute 16,000 employees.

The following Intel products will be for sale:

1. The IXP network processor and communications processor lines.
2. The Xscale processor business, which includes the StrongARM chip for PDAs, BlackBerrys, cell phones, handheld computers and portable media players.

Other product lines from the computer business will be for sale, though they have yet to be confirmed.

Intel began to get involved in the communications market in the late 1990s, but was hit harder than most other computer businesses when the segment took a turn for the worse several years ago and never fully recovered. It had a hard time fully comprehending the complexities of the communications business and how it was different from other areas of focus. Similarly, it couldn’t keep up with smaller competitors such as Marvell, Broadcom, Texas Instruments and many others.

Experts are still interested to find out what computer business Intel will do with its microprocessor business, the staple of its revenue, which is losing ground to Advanced Micro Devices, Inc. The product in most danger currently is the 64-bit Itanium processor line that has failed to be in demand since it appeared late on the market.

Added By: Joshua Feinberg