Will Intel’s Wonder Chip Arrive Too Late?

Intel's (NASDAQ:INTC) competitive position in the ultra-mobile market continues to improve with each generation. At the 32-nanometer generation with Medfield and Clover Trail, Intel proved that there were no fundamental barriers keeping Intel from penetrating the mobile market (i.e., busting the X86-myth). At the 22-nanometer generation, Intel's parts in both tablets and phones were solidly competitive, particularly on the CPU side of things. The 14-nanometer generation, which should arrive next year, is expected to be the one that "seals the deal."

Intel's 14-nanometer: It's Broxton that matters
By the very end of 2014, Intel expects to launch its very first 14-nanometer mobile processor code-named Cherry Trail. According to Intel's Cara Walker, this part will be aimed at performance and mainstream tablets -- including 2-in-1s and "phablets" -- although it's unclear if Intel's definition of "phablet" is more along the lines of a 7" voice-enabled tablet, or a 5-6" handset.

However, while the Cherry Trail parts should do well in the tablet market, Intel's big hurdle -- and the market that is by far the more important from a growth perspective -- has been the handset market. According to Intel's Investor Meeting, Intel's first truly high-end, "hero device" worthy system-on-chip for phones and tablets is called "Broxton." It will be based on the Goldmont CPU architecture and Intel's next-generation Gen. 9 GPU. It is also targeted at a "mid-2015" launch.

Source: Intel.

Who are the chief competitors?
Of course, no competitive analysis is complete without a discussion of what the competition will be doing. As of today, Intel's chief competitors in the high-end handset apps processor space are the following:

• Qualcomm (NASDAQ:QCOM)
• MediaTek
• Samsung (NASDAQOTH:SSNLF)

Samsung is particularly potent given that it also sells about 30% of all smartphones globally and could simply choose to block Intel from competing for that large chunk of the market. Qualcomm is the most aggressive on the chip/integration side of things, and MediaTek is able to very quickly deliver solutions based on off-the-shelf IP.

Fast-forwarding to mid-2015
By the time mid-2015 rolls around, the competitive landscape (in terms of shipping process node from each of these players) should be the following:

• Qualcomm's MDM9x35 modem built on the 20-nanometer process will ship during the second half of 2014, with a 20-nanometer apps processor with integrated modem likely shipping to customers by Q4 2014 for late Q1/early Q2 2015 device launches.
• Samsung will likely have a 20-nanometer Exynos part (likely based on ARM's Cortex A57) ready for the Galaxy Note 4 launch in the September/October timeframe, if not for the Galaxy S6 in early Q2.
• MediaTek, due to its position as a low-cost/high volume player probably will not move to the 20-nanometer node until 2015 after it has matured and costs have come down.

So, this essentially leaves Intel competing with its 22-nanometer Silvermont-based, quad-core Moorefield in phones during the second half of 2014 until the Broxton launch in "mid-2015."

Intel's 2014 mobile platforms. Source: Intel.

But what does "mid-2015" mean?
According to Walker, the timelines given at the investor meeting were silicon ship/availability dates. So, "mid-2015" implies silicon availability in the June-August 2015 timeframe. Given that Merrifield was launched in February 2014 and won't appear in devices until May/June, it is likely that Broxton-powered phones won't appear until 3-4 months after silicon launch. This implies a September-November 2015 timeframe.

Intel's Hermann Eul demonstrating Merrifield. Source: Intel.

Realistically, TSMC and possibly Samsung could be in a position to offer top-paying customers 14/16nm FinFET wafers (even if the yields aren't great). For example, the Galaxy Note 5 and the iPhone 6s should both presumably launch in the Sept. 2015 timeframe and are great candidates for 14/16nm FinFET silicon if it is ready but still expensive. Of course, Intel's 14-nanometer process is denser and likely higher performing, but the gap between Broxton and potential Apple/Samsung/Qualcomm FinFET chip implementations may not be as wide as the process availability gap would imply.

So, what's the bottom line?
If TSMC/Samsung can get 16/14nm FinFET designs into shipping devices by Sept. 2015, then Intel's manufacturing lead will have shrunken to less than one generation. If they cannot and those designs are using 20-nanometer silicon, then Intel's lead will actually be quite wide. Also, if Intel can advance to 10-nanometer designs quickly after the 14-nanometer Broxton (i.e., by mid-2016), then that could be the real "winner" while Broxton is merely "very competitive."