updated 10:25 am EDT, Mon May 9, 2011
NVIDIA buys Icera for 367 million
NVIDIA made the leap into making its own complete mobile chipsets on Monday with a deal to buy Icera for $367 million. The mutual agreement gives it access to cellular baseband chips for 3G and 4G phones and tablets. NVIDIA expected to become a one-stop shop for mobile makers who could get the main processor and its cellular link from the same company, both speeding up launch times and roughly double NVIDIA's cash from each sale.
The deal was a "key step" in NVIDIA becoming a "major player" in mobile, CEO Jen-Hsun Huang said. He insisted NVIDIA would still respect and support competing cellular chipset makers.
Approval was expected within a month and would see the arrangement profitable by the second half of 2012.
The arrangement could be a major blow to companies like Broadcom, Qualcomm, and Intel's recent acquisition, Infineon. All three depend heavily on selling chipsets to companies like Apple, LG, Motorola, and RIM. Phones using NVIDIA's Tegra processors could soon lock these customers out of the market and force them to go to competitors using TI's OMAP chips or other platforms. Qualcomm already has an edge in this area since it can make both Snapdragon processors and the 3G/4G modems to support them, and its position might have led NVIDIA to do the same.