Intel Set to Withdraw from TV SoC Market as Google TV Fails to Gain Popularity – Report

From X-bit Labs: With little room left to maneuver in the tough TV system-on-chip (SoC) market central to the ambitious Google TV initiative, Google partner Intel Corp. is quietly reshuffling resources away from the connected television semiconductor space and redirecting attention to the more profitable arena of chips for mobile devices like smartphones and tablets, according to an IHS iSuppli report.

While Intel is a giant in the semiconductor field, the chipmaker is struggling to compete in the TV SoC space. Dominating the TV SoC market in the first half of 2011 were two Taiwanese players: Mstar Semiconductor with 39% market share and MediaTek with 12%. A third major player, U.S.-based Trident Microsystems, had 6% market share.

The rest of the market was split up between two groups. Approximately 27% was held by vertically integrated manufacturers, including Samsung Electronics, Toshiba Corp. and Sony Corp., which make TV SoC chips to supply their own internally produced televisions. A second group comprising independent silicon providers – such as Zoran Corp. – accounted for the remainder of the TV SoC market with 14 % share. That leaves Intel and others with a scant 2 % share of market left to fight over.

“In a television semiconductor market characterized by entrenched suppliers and weak near-term growth prospects, Intel was facing enormous challenges in trying to establish itself as a competitor. And with the first-generation Google TV products proving unsatisfactory given their slow sales, it’s no surprise that Intel is moving away from the television SoC market,” said Randy Lawson, principal analyst for display and consumer electronics at HIS.

Google TV had been intended to enable a framework supporting the development of so-called Smart TVs. However, clear standards have yet to be defined for the effort, which was jointly announced in 2010 by Intel, Google, Sony and Logitech.

Smart TVs are defined as televisions that support Internet connectivity and interactive features. This contrasts with the traditional TV model of one-way broadcast transmissions viewed by a passive audience.

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