Intel has agreed to buy Lantiq Semiconductor, a German-based supplier of broadband access and home networking semiconductors. Terms of the deal were not disclosed.
The acquisition will expand Intel's opportunities in the growing market dubbed the Internet of Things (IoT), where everyday items - from heart monitors to automobiles - are connected to the cloud via embedded electronic devices.
Intel will also gain a stronger foothold in the cable residential gateway market and broaden its offering to other gateway markets, including DSL, vectoring and G.fast, fibre access networks (via GPON chips), and even LTE, cordless phones and smart routers.
Dan Artusi, Lantiq CEO said: “Intel and Lantiq share a common vision about the evolution of the connected home and the intelligent network. Together we can drive the transformation of the broadband customer premises equipment as it becomes a smart gateway that connects an increasingly diverse roster of devices and services in the home.”
Market research firm ABI Research predicts that the number of wireless gadgets is expected to double by the end of the decade, with most of this growth expected to come from smart devices other than PCs and mobile phones. This has set up a new battleground as Intel, Broadcom, Qualcomm and other chip makers look to establish themselves in the market.
Technology firms are betting heavily on Internet device-connected homes. Last year Samsung Electronics paid $200 million for US-based start-up SmartThings, which makes software that helps control everything from door locks to light switches in homes, while Google paid a massive $3.2 billion for Nest, a developer of connected thermostats and smoke detectors.
Kirk Skaugen, senior vice president and general manager of Intel's Client Computing Group, said: “By 2018, we expect more than 800 million broadband-connected households worldwide. Intel has been a global leader in driving broadband into the home and to connected compute devices. The combination of our cable gateway business with Lantiq's technology and talent can allow global service providers to introduce new home computing experiences and enable consumers to take advantage of a more smart and connected home.”
The transaction, which is subject to customary closing conditions and regulatory approvals, is expected to close in approximately 90 days.
Privately held Lantiq was formed in 2009 when Golden Gate Capital purchased the former operations of Infineon Technologies.