Intel Corporation (NASDAQ:INTC) is positioning itself in ‘Internet of Things’ and has agreed to buy Lantiq, a German firm specializing in home networking technologies and broadband access. Lantiq was previously under Infineon, and was bought in 2009 for about $400 million by Golden Gate Capital, a San Francisco, California-based private equity firm. Deutsche Telekom are among the companies that hold an interest in Lantiq through Golden Gate.
Lantiq will help Intel Corporation (NASDAQ:INTC) in its foray into the growing world of ‘Internet of Things’ (IoT), and will enable the chipmaker to bolster its presence in home products such as residential gateways and IoT smart routers, which are used in connecting devices at home to the internet and to one another. The acquisition positions Intel to take advantage of opportunities in a rapidly growing market that is estimated by Cisco Systems, Inc. (NASDAQ:CSCO) to surge on a global scale from 25 billion devices last year to 50 billion by 2020. Internet of Things, also known as M2M, is a developing battleground for tech companies such as Intel, QUALCOMM, Inc. (NASDAQ:QCOM), Google Inc (NASDAQ:GOOGL), and Samsung Electronics, among others.
More specifically, Lantiq enables Intel Corporation (NASDAQ:INTC) to boost its offering in other markets such as that of LTE and IoT. Kirk Skaugen, senior vice president and general manager of Intel’s Client Computing Group, said in a statement that “Intel has been a global leader in driving broadband into the home and to connected compute devices.” He added that merging Intel’s cable gateway business “with Lantiq’s technology and talent can allow global service providers to introduce new home computing experiences and enable consumers to take advantage of a more smart and connected home.”
Intel Corporation (NASDAQ:INTC) has been struggling with billions of dollars of losses in its mobile chipset division, but its IoT business is a promising venture. For the fourth quarter of the previous year, the unit brought Intel an operating profit of $185 million on revenue of $591 million. Year-on-year, it recorded an operating profit of $616 million, a growth of 12 percent from 2013, and a revenue of $2.14 billion, up 19 percent.
This article has been written by Nonito Guntan.