Intel Corporation (INTC) is expected to emerge as one of the few survivors of the ruthless implementation of Moore’s Law in the semiconductor industry, monetizing its manufacturing capabilities with its own product and also engaging in foundry partnerships with fabless companies, says John Pitzer, Managing Director, Global Technology Strategist and Analyst at Credit Suisse Group.
“It’s our view that Intel will be the last man standing on Moore’s Law. Before they are right, they will find multiple ways in which to monetize that in their core business by bringing out incremental performance that people will pay for, and in the nontraditional markets of tablets and smartphones by getting down their cost points and performance points that other people won’t be able to match,” Pitzer said.
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Intel further monetizes its advanced semiconductor manufacturing capabilities by partnering with other companies in foundry partnerships. Its leadership in this segment, Pitzer says, is expected to result in the world gathering at its factories for advanced chips.
“What you are seeing is Intel‘s manufacturing lead is stretching out, but Intel is now signing up foundry partners. The most public one was Altera (ALTR) about a month and a half ago who has historically been a customer at TSM. Altera has decided to use Intel because they have a better manufacturing process. We think Cisco (CSCO) will also start to build chips at Intel, as well as Apple (AAPL). This is all based upon this view that Intel will be the last man standing on Moore’s Law. They will continue to stretch out their manufacturing lead, and the world will be forced to be on the path to their door,” Pitzer said.
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