While Intel may have had a very long and fruitful relationship, they don’t seem willing to sacrifice their business just to help Microsoft. So they will try whatever it takes to stay afloat, because just like Microsoft, Intel is in serious danger of declining along with the PC market.
Intel has realized a while ago (actually from the Andy Grove days) that to be alive tomorrow, you must conquer the low-end today. Because if you leave others take over the low-end of your market, it’s only a matter of time before they start making higher quality products and move into the mid-end of the market, and finally into the high-end of the market. So if you try to dominate the low-end, too, then you won’t have to worry about such a possibility as much. It’s really why Intel made Atom for netbooks in the first place, even though they hate the margins on them (and still do).
The problem for Intel is that ARM is already dominating the low-end (chip market) today, because of price and because it’s already dominating in the mobile devices market, and so far it’s been very hard for Intel to get into that market. Because of that, Intel can’t wait around for Microsoft to “get it right” with Windows on low-end devices, tablets and hybrids. They will try to ride with the fastest growing operating system right now – Android.
Windows 8 still has some big disadvantages, which makes a device of similar specs with an Android one (or Chrome OS), be significantly more expensive. First, it puts at least a $100 license cost on top of the device, and second, it needs at least a 16 GB drive all for itself, which also costs quite a bit of money. That makes devices with Windows 8 $100-$150 more expensive than the ones with Android that have similar hardware, and the same amount of free storage. At the low-end especially, that makes a huge difference.
If Windows devices don’t sell, then Intel’s chips don’t sell either. And that’s why Intel is going to become a lot more aggressive with pushing Android and Chrome OS into the market, even instead of their own Meego/Tizen operating system that they’ve tried to build with Samsung. This doesn’t necessarily mean Intel will succeed, as ARM chips still have leadership in chip price points, power consumption and even performance, and Intel can only go so far down in price even with Atom, while ARM chips can even cost a few bucks. But Intel has no choice but to try all of their options.
[Via Cnet]