Samsung chooses Intel to power Galaxy Tab 3 model

Can Intel's deal with Samsung improve the chipmaker's long-term prospects?
Written by Charlie Osborne, Contributing Writer
GALAXY Tab 3 10.1-inch (4)

Stealing custom from ARM, Intel has secured a contract to power one of Samsung's new tablet products.

Announced on Monday, Samsung revealed two new products for its tablet line -- the 8-inch and 10.1-inch Galaxy Tab 3, possibly designed to try and claw back marketshare from Google and Apple which have produced the Nexus 7 and iPad Mini tablet computers.

The 8-inch model features a 1.5 GHz dual-core processor, a 1280 x 800-pixel HD screen and runs on Android 4.2 Jelly Bean. The tablet also sports two cameras, 1.5GB RAM, and is available with either 16GB or 32GB of internal storage.

The 10-1-inch model also contains the same features, but according to Reuters, the larger tablet is powered by a 1.6 GHz Intel dual-core processor provided by Intel.

The U.S. chipmaker has struggled in the mobile market, but an agreement with Samsung is likely to boost the company's prospects and is expected to pave the way for Intel to expand its presence in the mobile device market. However, moving into the Android market will require vast time and resources, which may explain reports that the number of chip engineers based at Intel Korea has risen from six last year to over 50.

A Samsung researcher told The Korean Times :

"This is a win-win deal for both sides. Intel, which is trying to cut its heavy reliance on PC business, offered better pricing for Samsung that is shifting its focus toward tablets following its huge success in smartphones. Samsung wants to secure as many processors as possible at better pricing.

That's why Samsung Electronics has recently been diversifying its procurement channel in processor chips as a strategy to stabilize production yields of its in-house Exynos-branded processors."

In Q1 2013, Intel's financial results were hurt by the slumping PC market, and the firm reported gross margins of 56 percent, which were below expectations of 57.9 percent. This year, Intel projects low single digit percentage sales growth, but with the introduction of mobile-based chips and the deal with Samsung, the chipmaker may be able to improve its long-term prospects.

ARM, known for its energy-efficient technology, is by Samsung to extend the battery life of its Galaxy Tab series as well as the Samsung Chromebook. At this year's Computex conference, the company announced a new series of chips designed for mid-range smartphones, including the Mali-V500 which is designed to prevent the copying and distribution of video through mobile device streaming.

The chipmaker has also invested in mobile security and ecommerce; establishing a joint venture with Germalto last year to create mobile security solutions for corporations.

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