3G-HSPA, Mobile Linux and Open Source are the Big Winners in Intel-Nokia Partnership

But it was very difficult to extract any tangible take always from the press
conference announcing the partnership. That’s because no specific products were
identified and no time frames were given to see the results of this highly
acclaimed collaboration.

To a large extent, the press conference was a lot of hand waving and gesturing,
without providing anything of substance that we might expect from such an
important strategic relationship. This is the third time in the last decade that
Intel and Nokia have announced a partnership, with the previous two attempts not
producing much if anything at all. So the industry might have a right to be
skeptical this time. Nonetheless, it certainly sounded exciting.

Anand Chandrasekher, Sr VP and GM of Intel’s Ultra Mobility Group stated, "The
leaders in both computing and communications are coming together to accelerate
innovation while driving exciting new revenue opportunities. Intel and Nokia are
joining forces to announce a long term strategic relationship that will align
and shape the next generation of mobile computing."

We are all aware that smart phones and intelligent hand held devices contain
powerful processors and need mobile broadband capability to unleash "the
tremendous power and potential to reshape our lives." With many different
wireless communications options, most of us expect that "the future will bring
even more ways to be connected- a future full of different possibilities." Yet
that kind of talk dominated the prepared remarks of Intel and Nokia during the
conference.

Nokia told us more of what we already know: "The Internet continues to evolve
and touch every aspect of our daily lives. Today, there are more Internet users
(at 1.6B) than there are fixed phone lines (at 1.3B). New applications will
drive the need for more powerful compute engines and faster (mobile) broadband
wireless access, Consumers looking for mobile devices to do more, e.g. sensors,
new apps, new materials, new device design and form factors (e.g. netbooks MIDs). We need to extend computing platforms, build on common open platforms and
explore new architectures."

Anand told us that Intel would continue to "relentlessly focus on driving down
the cost and power requirements (of new devices), while delivering continuing
performance improvements." Should we have expected something different? We were
also told more of the obvious, "Mobile devices require high bandwidth- mobile
broadband communications and ubiquitous Internet connectivity at a reasonable
cost. Users should expect a rich experience, any time, anywhere. New and
exciting services across a range of devices, including new ones the companies
will be defining together."

So what’s really new? There are three aspects of the partnership, which
is not limited to just hardware and R&D:

Intel and Nokia will collaborate on several open source initiatives, most
importantly Mobile Linux. Nokia pointed out that "Hardware and software are
decoupled these days. Mobile Linux is an important part of the new converged
mobile computing world." We would expect Intel and Nokia joint software
development to be centered on two open source projects:
- Moblin, originally an Intel project but now run by the Linux Foundation.
- Maemo, a Nokia implementation created for an Internet tablet.
Intel is licensing 3G HSPA modem technology from Nokia, complementing its own
WiFi and WiMAX silicon. (Note that two years ago, Intel licensed an HSPA module
from Nokia for use in notebooks. This technology transfer is intended for Intel
to offer HSPA silicon for mobile hand held devices).
Intel and Nokia have entered into "a long term strategic partnership to
develop a new class of mobile computing devices." Those future mobile computing
devices will be based on Intel architecture defined chip sets and will "leverage
each company’s expertise."

And what about Mobile WiMAX? Don’t expect anything from the partnership. In
response to a question on further WiMAX co-development, Anand replied, " This
announcement has no effect on WiMAX one way or another. We are still committed
to it. In this announcement, we are expanding our wireless portfolio to be able
to implement Nonie’s 3G HSPA technology."
This implies that Intel will no longer debunk HSPA technology in favor of Mobile
WiMAX and suggest that network operators leapfrog 3G and move to Mobile WiMAX
instead.

When a questioner pointed out that Nokia now had licensed 3G-HSPA to five
different companies, Intel and Nokia responded as follows:

Intel: "3G HSPA technology has been licensed to build into future mobile
offerings. No comments on products or timing. Nokia and Intel’s vision is very
similar- bringing communications and computing together. This is not an
exclusive agreement."

Nokia: "3G HSPA is what’s on the market today (implying Mobile Wimax is
NOT really on the market). Nokia is licensing its 3G-HSPA-modem technology as
widely as possible within the industry."

When asked if Intel had made any other inroads in the mobile phone business
(which the company has tried to crack for years, but has not succeeded), Anand
replied, "Intel is not public on any wins in the mobile phone arena except for
LG." Then when asked what type of LG device would be forthcoming, Anand would
not comment on the specific LG device that will have "Intel inside." This
despite Intel having previously touted the LG MID (with Ericsson HSPA) as the
highlight of this year’s Barcelona MWC.

The stonewalling continued in response to other very reasonable questions about
partnership deliverables:

Question from Bloomberg News: "There have been a lot of announcements
about visions of the future. Intel has tried to get into the mobile
communication business for a number of years, yet they have not succeeded. There’s still a degree of skepticism until we know when the first Intel powered
mobile device will be out there. Can you tell us?"

Intel: "We will work together on strategic technology collaboration which
spans three areas: Intel Architecture defined chip sets for future mobile
computing devices, mobile and MIMO collaboration to deliver a very rich software
environment for applications and user experience, Intel licensing of Nokia’s 3G
HSPA technology No products announcements at this time- not for today’s
discussion."

Question: "Do you expect the Atom family (Intel’s lower power
micro-processors) or x86 family to be embedded in future mobile computing
devices?"

Intel: "No comment on brands or usage."
Nokia: "Premature to say how we will apply the technology at this stage."

How will the Mobile Computing Industry be effected as a result of this
partnership?

Could these mobile devices, with open source operating systems like mobile
Linux, cause MSFT to lose its software domination of the computing world? Mobile
Linux – one of the three focus areas for the Intel-Nokia partnership – is a
direct competitor of MSFT’s Windows Mobile. As people increasingly use mobile
computing devices to do things that would have required a PC a few years ago,
MSFT is likely to lose ground. Mobile computing devices, e.g. smart phones, MIDs,
all-in-one gadgets, etc are already replacing a lot of things we do today on
PCs. This trend will likely accelerate as mobile computing replaces desktop
computing.
Does this announcement negatively impact Mobile WiMAX, which already has been
severely criticized for the lack of mobile devices with native mode air
interfaces? After all the about WiMAX MIDs, we are still waiting for those
devices to hit the market in a big way. Will "the Internet in your pocket," be
based on 3G-HSPA, rather than Mobile WiMAX?
An anonymous Intel employee, provided his own read on the partnership:
"This announcement does not change any of Intel’s plans on WiMAX which are solid
going forward. Intel has not been a major player in Smart Phones/MIDs and we
want to get into that space with the Intel AtomÃ?Â® Processor so this one part of
this strategy. Also most smart phones shipping today at least have 2G/2.5G and
many also 3G. So this licensing deal help fill a gap in our wireless
technology portfolio.
It also allows us to provide WiMAX solutions to Nokia once more networks get
deployed and they want their mobile devices to have WiMAX support as well. So by
no means does this negatively affect our WiMAX strategy. It only opens new doors
for us with a large customer like Nokia."
When will the new mobile computing devices hit the market? They will need to
come quickly, if they are to compete with all the new smart phones from Apple,
RIM, and Palm. We hear there will also be MIDs coming soon from Samsung and
various Taiwanese companies. Previous Intel – Nokia partnerships, e.g. HSPA
modules for notebooks, have not been successful so the industry is skeptical
that this one will succeed. We would expect to see Intel-Nokia mobile computing
devices on the market in less than one year and perhaps as early as this
December.