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Intel develops new phone chip

Intel Corp, the world's biggest semiconductor maker, will start selling a new chip to power high-speed mobile phones next year in an effort to win handset customers from Texas Instruments Inc.

The chip will be targeted at both "top-end" and "volume" phones, said Gadi Singer, head of Intel's cellular and handheld unit, at a meeting with journalists in Cannes, France. The company will introduce the product in the second half of the year, and it will debut in phones next year, he said.

Intel is seeking to get more sales outside its main computer microprocessor business, which accounts for more than 80 percent of annual revenue. The Santa Clara, California-based company is trying to take clients from Texas Instruments, whose chips powered more than half the mobile phones sold last year.

The chip "is going to redefine what a phone can do in 2005," Singer said. "There's a lot of interest toward it."

Singer declined to say whether the company is in talks to sell the product to mobile-phone makers.

The chip, dubbed Hermon, will be used in mobile phones that use so-called wideband code-division multiple access, or WCDMA, technology and allows videoconferencing between phone users.

More than 50 operators are expected to offer high-speed services by the end of the year, Nokia Oyj, the biggest handset maker, said on Monday.

About 5 million users will probably be using high-speed services by the end of this year, Rudi Lamprecht, who heads Siemens AG's wireless division, said on Wednesday. User numbers will rise to about 40 million next year and 100 million in 2006, he said.

Separately, Finnish telecommunications equipment giant Nokia acknowledged Wednesday that the development of third-generation (3G) mobile telephones took more time than expected.

Facing criticism from operators over a lack of quality handsets, Nokia chief executive Jorma Ollila said that 3G networks, which must be compatible with the previous generation known as GSM, had needed to be checked before mobile handsets were tested.

"Without stability of networks, you cannot test handsets," Ollila said.
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