There have been rumors floating around for quite some time that Intel (INTC +2.61%), the chip behemoth that still hasn't quite made the inroads in tablets and smartphones that many have hoped to see by now, had won the next-generation Google (GOOG +0.56%) Nexus 7. While these rumors seem plausible, particularly as Intel is making an aggressive push into the low-end and mid-range tablet market with its Bay Trail-T system-on-chip, a new rumor, courtesy of Digitimes, has popped up.
A Nexus 8, you say?
According to a piece from Digitimes, Google is preparing a next-generation, 8-inch tablet (presumably known as the Nexus 8). This tablet is likely to be designed and built by ASUS (the brawn behind the previous two very successful Nexus tablets). Further, Digitimes notes that sources from the upstream supply chain claim that this tablet will be powered by an Intel Bay Trail-T system-on-chip.
For those of you unfamiliar with the story, Bay Trail-T is Intel's current-generation 22-nanometer tablet-oriented system-on-chip. This product was originally designed for Atom notebooks/netbooks, as well as high-end tablets, but Intel decided to attack the broad swath of the tablet market (in particular, the value/mid-range space) with this particular product. Since Bay Trail-T's platform bill-of-materials is higher than that found on competing platforms, Intel is aggressively making up the difference in the form of rebates to its OEM partners to drive adoption.
How likely is this to be true?
This is unconfirmed and, frankly, for a tablet that is likely to be launched in the June-August time frame, anything could happen. That being said, it's unlikely that Intel will achieve its goal of "over 40 million tablets" sold during 2014 without at least a few major wins, and given that Intel already has a very strong relationship with ASUS from the PC world, this isn't incredibly far-fetched.
Further, if Intel and Google are able to deliver a 64-bit version of Android, this could be a great marketing point that no other merchant chip vendor in this space could provide today. While hardcore techies know that "64-bit" isn't really a reason to get excited, this is a marketing buzzword that just can't be ignored. Additionally, Bay Trail-T is a solid performer (if a bit lacking on integration and graphics leadership), so ASUS wouldn't be choosing a bad part by any means.
Qualcomm and NVIDIA likely to fight hard
While Intel is powerful and its relationships with both ASUS and Google are strong, it would be a mistake to assume that NVIDIA (NVDA +0.69%) and Qualcomm (QCOM 0.76%) won't fight hard for these sockets. NVIDIA actually had the very first generation Nexus 7 with its Tegra 3, but lost it to Qualcomm in the second-generation Nexus 7.
It's unclear whether Google will offer both a Nexus 7 and a Nexus 8, but investors should rest assured that both NVIDIA and Qualcomm will fight Intel tooth and nail to win any Nexus slots available. Further, both NVIDIA and Qualcomm have pretty compelling silicon coming down the pipeline with their Tegra K1 and Snapdragon 805 parts, respectively, so it's not as though Intel's Bay Trail is invulnerable.
Closing thoughts
Intel needs a big tablet win to really validate the x86 architecture on Android. While Google has supported x86 for quite some time, and while Intel has bent over backward to provide as much developer support as possible, there needs to be a lot of hardware that developers will feel remiss to ignore. If Intel wins the Nexus 8, then this will probably be the key win to finally establish x86 as a viable architecture on Android -- even if Intel has to essentially recognize zero net revenue on these parts thanks to BoM subsidies.
