US chipmaker Intel said on Monday it will produce chips for Taiwan's MediaTek, one of the world's largest chip design firms.
The manufacturing arrangement is one of the most significant
deals Intel has announced since it launched its so-called foundry business
early last year.
“That's a pretty big deal for us to engage a customer from
Taiwan and them betting on us to grow and try this. And so this is a major
anchor customer win,” Randhir Thakur, president of Intel Foundry Services, told
Reuters.
TechInsights' chip economist Dan Hutcheson said there were
doubts in the industry on whether Intel could pull off the foundry business,
but the deal with MediaTek shows it's on the right path and its investments,
including in recruiting the right executives, are paying off.
“When you go into a foundry, you're putting at risk about
two years of work,” said Hutcheson about the risk for chip design firms like
MediaTek. “If something happens and the foundry can't pull it off, you've lost
that design window in that market window.”
While Intel didn't give any financial details of the deal or
say how many chips it would be producing for MediaTek, it said the first
products would be manufactured in the next 18- to 24- month period and will be
in a more mature technology process called Intel 16, with the chips used for
smart devices.
“MediaTek has always adopted a multi-sourcing strategy,”
MediaTek said in a statement. “In addition to maintaining close partnership
with TSMC in advanced process nodes, this collaboration will enhance MediaTek's
supply for mature process nodes.”
Intel previously announced that its foundry business has
signed deals with Qualcomm and Amazon.