Intel acquires Mobileye, shows first fruits of Spreadtrum alliance

Intel may be facing its first real challenges in its data center processor market (see separate item), but it is expanding into new areas aggressively with new acquisitions and partnerships. It is making a much-anticipated purchase, of Israel-based connected car specialist Mobileye, and it has showed off the latest fruits of its strategic alliance with Spreadtrum of China.

The world’s largest chipmaker will pay a hefty $15.3bn for Mobileye, to boost its position in the self-driving vehicle market. Mobileye, which is an existing partner, makes machine vision sensors which help detect obstacles in the road.

Intel CEO Brian Krzanich wrote in an email to employees that Mobileye’s cameras would be combined with the Xeon processors, 5G modems and other technology to create an “end-to-end” system for autonomous vehicles that runs from the car to the cloud. “This acquisition essentially merges the intelligent eyes of the autonomous car with the intelligent brain that actually drives the car,” he wrote.

Intel and Mobileye said the deal would “accelerate innovation for the automotive industry” and bolster Intel’s position in the market for highly and fully autonomous vehicles, which the giant estimates will be worth up to $70bn by 2030.

Intel’s global autonomous driving business will be headquartered in Israel and headed by Mobileye co-founder and CTO Amnon Shashua. Last year, the company created a separate division called the Autonomous Driving Group to demonstrate its deep interest in this space.

The deal is expected to close by year end and will be the biggest acquisition of an Israeli firm by a foreign company in the state’s 69-year history. There are many purchases of hi-tech start-ups from Israel’s fertile industry, but far fewer of mature companies.

But this particular acquisition has been on the cards for a while, as Mobileye has become increasingly strategic to Intel as its connected car ambitions have grown. The pair have a partnership with BMW to build a fleet of fully autonomous cars by 2021 and their alliance, augmented by a deal with Delphi, is so important in the connected car world that some are calling it the Wintel of that market, because it could combine the smaller firm’s excellent and specialized vision algorithms with a more advanced processor roadmap than its own.

Daniel Galves, Mobileye’s chief communications officer, spoke to EETimes last year about the possible division of labor between its own technology and Intel’s, prefiguring what Krzanich is now saying about the merger. He said: “The Mobileye SoC will run all sensor processing software (8-camera surround view by Mobileye, radar/lidar processing by Delphi), localization mapping by Mobileye REM, and sensor fusion will run. On the Intel SoC, all driving policy (reinforcement learning algorithms for path strategy by Mobileye) and driving control (driving behavior software by Delphi’s Ottomatika) will run.”

That is before Intel has even unveiled its expected automotive system-on-chip, based on multiple Xeon cores, which could combine with Mobileye’s EyeQ chip, which supports computer vision in the ADAS (advanced driver assistance systems) which Mobileye dominates.

The value of Mobileye to Intel was demonstrated last year when it appeared to deal a blow to Nvidia, whose GPU-heavy approach to AI-driven platforms is causing Intel headaches elsewhere (see separate item). Nvidia was at the heart of the Audi zFAS – a centralized assistance controller the German carmaker is developing with Delphi and Mobileye, which also uses FPGAs from Altera, now part of Intel. If Altera will open doors for Intel in some unfamiliar markets, supporting optimized coprocessing for tasks with which standard x86 CPUs struggle, that will also squeeze some other chipmakers with a longer history in machine-to-machine and automotive. Mobileye, for instance, has traditionally worked with STMicro.

In another chip market, Intel was showing off a new mobile system-on-chip at Mobile World Congress, developed by Spreadtrum of China. Of course, Intel crashed out of the smartphone SoC space last year, though it remains a major force in modems and has recently announced its first iPhone deal and its first product based on preliminary 5G NR specs.

The SC90861-IA, however, is something different, as it does not use an Intel modem, but does rely on an Intel CPU. That is because Spreadtrum – a major Chinese modem maker in which Intel has a stake – has developed the offering, using its own baseband combined with an Intel Architecture processor, based on the Airmont architecture and manufactured by Intel using its own 14nm LP process.

Spreadtrum was responsible for integration and overall design, and the 64-bit octacore LTE SoC represents the first tangible result from Intel’s $1.5bn investment in the firm, three years ago. Spreadtrum said the SoC is sampling and already has a design win with a Chinese OEM which will market the resulting phone inside and outside China – the name will be revealed in the second quarter.

When Intel was still in the smartphone processor business, its Chinese alliances with Spreadtrum and others looked very important to boost its fortunes in the huge market, one where it could harness local partnerships, and their distribution networks, to work around Qualcomm.

An important reason for the Chinese players to sign up was to take advantage of Intel’s manufacturing prowess, and now that the US firm’s mobile SoC ambitions have died, this will be the most strategic remaining element of its Spreadtrum deal. Krzanich has been building up a foundry business to generate external revenues, as well as internal advances, from cutting edge process technology, and Spreadtrum’s chip will be a boost for that. So far, Intel has been unable to win large customers to use its foundry service for commercial SoCs.

In addition, said an EETimes source, this “paves the way for Intel to manufacture their own new XMM 7560 modem later this year in their own fab for the first time, targeting Apple.”

Spreadtrum CEO Leo Li has previously said that its alliance brings it three benefits – “access to Intel’s foundry, strong IP and Intel is the only processor architecture company that has its own foundry.”