Intel’s strategy of upgrading PC chips
Intel (INTC) follows a “tick-tock” strategy. Under the strategy, PC chips are upgraded within 12 to 18 months. However, manufacturing hurdles from 2000–2008 delayed the release of PCs with fifth-generation Core processors. This led to a longer life for fourth-generation Core chips—Pentium4—that are based on the current Haswell architecture.
Intel was slow to upgrade chips. This provided an opportunity for Advanced Micro Devices (AMD). It enhanced and added innovative features to its Athlon processor chips. As a result, it gained market share in the PC processor market. However, this move and the rapidly changing technology environment got Intel to change its architectural approach with Pentium D and Core processors. They were well received in the market.
As the above chart shows, Intel’s Core M processors are being compared with its peer’s products. Intel scored better than Microsoft (MSFT) surface Pro 3, Nvidia (NVDA) shield tablet, AMD’s Mullins Tablet, and Apple’s iPad (AAPL). Intel Core M 5Y70 or Lama Mountain with 4.5W TDP was able to outperform the Surface Pro 3 CPU that uses 15W TDP parts.
Intel Core M PC chips are expected to drive tablet growth
Intel Core M performance
Intel Core M processors, or Lama Mountain, are expected to be available by the end of October 2014. They have a fanless design, better central processing unit (or CPU) and graphics performance, and low power consumption. As a result, they’re expected to lead to more design wins for Intel. They will drive volumes in the tablet segment.
In the first half of 2014, Intel launched 15 million shipments. 3Q14 saw the same amount of CPU’s being shipped. Intel expects that the launch of Core M processors will allow it to reach the 40 million tablet CPU shipment goal.