Intel, RIM Pact Just Vapor Deal?

A pact between chip king Intel and Research in Motion (RIM), Canadian maker of the Blackberry mobile communication device, appears less imminent than originally reported.

Rumors of a technology exchange deal between the companies spread like an airborne virus on Monday following a CNBC report predicting an agreement would be announced at the Pentium Pasha’s shindig for developers held this week in San Francisco.

In the rumored agreement, RIM would license some of its Blackberry technology to Intel in exchange for using Intel’s chips in its Blackberries and becoming a tout for WiMax, a wireless technology that’s become an Intel darling.

Deal? What Deal?

However, by week’s end, the deal appeared to be pure vapor.

When contacted by TechNewsWorld about the purported pact, spokespersons for both companies said they don’t comment on rumors.

Marisa Conway, an external spokesperson for RIM, said in an e-mail, “RIM’s standard policy is to decline comment on rumors or speculation.”

A similar response came from Intel spokesperson Mark O. Miller when he was asked for a comment about the reported deal. “Unfortunately there’s not much to report on our end,” he wrote in an e-mail. “We don’t comment on speculative stories.”

Dual Core Difficulties

According to a research report released this week and written by Peter Misek and Dushan Batrovic, two investment analysts for Canaccord Capital, of Vancouver, B.C., Intel is having trouble making a mobile version of its dual core chipset.

“Our checks originally lead us to believe that Intel was encountering considerable difficulty in developing a battery, bandwidth and heat-efficient Centrino dual core chipset,” the pair wrote in their report, a copy of which was obtained by TechNewsWorld.

According to the duo, RIM has technology that could address those three problems. “RIM’s technology presents considerable advantages to Intel’s original dual core design” they wrote. “[W]e have heard that RIM’s combined solution would improve battery life three-fold and significantly reduce the Centrino’s bandwidth and heat generation.”

“We believe this partnership would make sense for Intel, they added, “additionally because the company is expected to be looking beyond laptops and PCs towards the cell phone market, which represents an 800 million-unit per year opportunity.”

WiMax Blackberry?

A pact would make sense for RIM, too, according to Ellen Daley, an analyst with Forrester Research in Boston. “This agreement is built around RIM using Intel chips because of their really good battery-saving capabilities,” she told TechNewsWorld. “Then Intel and RIM working together to help promote wireless and Intel borrowing some of RIM’s really efficient spectrum signal coding.”

RIM already makes a WiFi-enabled Blackberry, but if it embraced WiMax, at Intel’s urging, it could have the best of all wireless worlds, according to Jeff Thompson, President and Chief Operating Officer for TowerStream, of Middletown, R.I., a major provider of WiMax networks.

There are currently three wireless technologies for handheld devices, he explained. There’s 3G, a 10-year-old technology with slow data transfer, but a range of multiple miles; there’s WiFi, which has good speed but a short range, 300 feet or so; and then there’s WiMax, with speeds reaching multiple megabits and a range of multiple miles.

“The Blackberry would be a great device if you could get WiMax into it, especially with the nice screens they have and with their e-mail capabilities,” Thompson told TechNewsWorld. “It would really unlock the Internet and give you a great customer experience.”

Fixed WiMax First

A Blackberry with mobile WiMax, though, isn’t in the immediate future, according to Forrester’s Daley.

“If you’re a mobile professional, the implications of an Intel-RIM deal would be a pretty long ways off,” she said. “RIM’s hardware is a mobile device; you use it on the move.”

“Where WiMax is maturing as an industry is in fixed WiMax,” she continued. “That’s where the deployments are being rolled out.”

“Fixed WiMax is about getting broadband to hard-to-reach rural places or for wireless backhaul,” she added. “It’s not going to be used for mobile devices like a Blackberry.”

“It’s really mobile WiMax — 802.16e — which won’t be available until 2007 that will truly have an impact on devices that are mobile,” she maintained.

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