PORTLAND — Intel revived its slumbering contract manufacturing business Tuesday, announcing it will make computer chips for smartphones based on technology from rival ARM Holdings.
Intel has plenty of manufacturing capacity, with one leading-edge factory sitting idle in Arizona even as it wraps up construction on the second phase of its D1X factory in Hillsboro. Intel will make the new chips for LG Electronics.
The new manufacturing customer could help fill those factories while giving Intel a back door into the market for mobile chips, a segment of the industry where it remains essentially shut out.
Intel declared three years ago it was open to making chips based on designs from rival ARM but it found no takers until now. When Intel announced its strategic overhaul last spring it didn’t even mention contract manufacturing — known in the chip industry as foundry work — and the future of its foundry business appeared in doubt.
At this week’s Intel Developer Forum in San Francisco, though, Intel announced it will make mobile chips for LG using ARM-based designs. ARM’s customizable chips dominate the market for smartphone and tablet processors, a sector where Intel remains essentially shut out.
Intel will use its latest, 10-nanometer manufacturing process for LG’s chips. Intel hopes its advanced production technology will help it lure more foundry customers.
The chipmaker may also hope that it could eventually package some ARM-based chips with Intel’s own wireless technology. That could open the way for Intel to make complete sets of chips for mobile device makers, even if the underlying microprocessors aren’t based on Intel technology.
Also Tuesday, Intel announced it will not use extreme ultraviolet lithography technology in the 10-nanometer generation of its chips and said the technology is not ready for the forthcoming 7-nanometer chips. Chip manufacturers have been waiting for new lithography techniques for years, and the absence of EUV has slowed the advance of microprocessor technology.
“I can’t say whether it’s a year from now or three years from now,” said Mark Bohr, director of a group overseeing Intel’s manufacturing advances, according to Bloomberg. “I am hopeful.”
Intel also announced a new, wireless virtual reality headset called “Project Alloy.” Virtual reality is a hot market in technology and one that places extreme demands on computers.
