Intel Bets Big On The Ultramobile PCIntel Bets Big On The Ultramobile PC

ALL IN
Financially tenuous or not, it's a market that Intel's competitors are jumping into, too. Just weeks after Intel's ultramobile announcement in Beijing, AMD said at Computex in Taiwan that it will produce a new chipset, code-named Bobcat, for UMPCs. No details were offered, but Bobcat will likely be a slimmed-down version of AMD's upcoming notebook platform, known as Puma, which includes the new Griffin processor, the first CPU from AMD that's designed specifically for mobile applications.

Qualcomm, whose chips power most of the world's CDMA cell phones, is entering the market as well, with a new platform known as Snapdragon that will add longer battery life and broadband connectivity not just to subnotebook computers but consumer electronics as well. Asia's chipmakers aren't far behind: Taiwanese semiconductor company VIA Technologies said earlier this month that it will move aggressively into the UMPC market and is in talks with hardware vendors to include its chipsets in devices that could hit the market later this year.

Still, Intel claims to have the technology edge for the foreseeable future. Early next year, devices with Intel's next-generation ultramobile platform, known as Menlow, will begin to appear. Menlow comprises the new Silverthorne processor, featuring a new 45-nanometer design and new "high-K" materials to replace silicon dioxide ("K," the Greek letter kappa, refers to the ability of a material to hold an electric charge), reducing transistor leakage while increasing performance. Designed from the ground up for subnotebook devices, Silverthorne's use of high-K materials is "the biggest change in transistor technology since the introduction of polysilicon gate MOS transistors in the late 1960s," said Intel co-founder Gordon Moore earlier this year.

As the size of a transistor shrinks to 45 nanometers, explains DeLine, it gets more and more difficult for it to hold a charge. "You've got leakage, and leakage means lower battery life, which is unacceptable in this class of device," he says. Intel has "pushed through a wall" with the high-K metal gate, he says, which will support "silicon sizes and power levels that enable us to get into that [ultramobile] form factor."

Form factor, says Eden, is one of four requirements Intel designed around in the move from desktop computers to notebooks, along with increased performance, long battery life, and wireless connectivity. To those four "vectors" Eden now adds a fifth: personalization, the tendency for users to combine their business and personal lives--calendars, photos, music, video, connectivity, etc.--on one mobile device. Those devices, Eden predicts, will be Intel's "growth engine" going forward.

THE RISK
Ultimately, the issue for Intel and the other vendors pushing into the subnotebook category is the C-V-D question: convergence vs. divergence. On one hand, you can view the mobile Internet device (like the one from EB that Perlmutter is holding in the picture on the first page) as the single converged handheld device that will combine all the power and features of a smartphone, a high-end cell phone, an MP3 player, and a laptop. On the other hand, you can see it as just another device to lug around. To the degree business users view UMPCs as the former, Intel's gamble will succeed. If it's the latter, well, Perlmutter's aware of the problem. "The risk is that this isn't so much a category that people really need, but an in-betweener that nobody needs," he says. "We're not ignoring that risk. We think this is a chance to re-create the whole smartphone category, to give it more life and more enthusiasm."

John Straub, VP of IT at Lafayette Federal Credit Union in Kensington, Md., says he's watching the ultramobile evolution, but not yet diving in. "To a large extent the BlackBerry does what we need it to do," says Straub, who manages around 20 BlackBerrys used by executives and field personnel for the credit union. "But if you had a screen that was three or four times bigger, and full Internet access wherever you are, in something that you can still carry around easily, I'd say that has a lot of potential."

Then Straub drops the name that looms large over this market category: iPhone. The forthcoming Apple device, says Straub, "is probably a more useful version than the mobile Internet devices that Intel or Samsung have in mind."

Like Straub, many IT pros are intrigued by the iPhone's combination of Apple's Safari browser plus the company's legendary multimedia capabilities. Whether the iPhone, with its sub-3G connectivity and its AT&T-only service model, will catch on in the business world remains to be seen. But the buzz over the device, expected later this month, is overshadowing awareness of other products in the category--both smartphones and smartphones on steroids.

The buzz may overwhelm Intel's strategic push, or it may prove to be what carries this product category forward. Either way, having already made its bet, Intel's in it for the long haul. "The design cycle is relatively long compared to the market, so we have to have this magic ability to predict what people would like to have three or three-and-a-half years from now," Eden says. And he points out that Intel made the same kind of bet on Wi-Fi technology four years ago: Now 96% of laptops are Wi-Fi-enabled.

To get to that kind of market acceptance with the unknown, untried ultramobile PC, Intel is going to need that magic now as much as it ever did.