Intel will withdraw from the TV market

CHIPMAKER Intel is leaving the TV market after failing to generate interest in its chips for smart TVs, the company revealed.

Intel will withdraw from the TV business and refocus its Digital Home Group resources on more successful markets, such as smartphones, tablets and ultrabook laptops, said Claudine Mangano, a spokesperson for Intel, according to Bloomberg.

Intel entered the emerging smart TV market in 2010. It partnered with Sony and Logitech to develop the first range of Google TV devices, including a smart TV and set top box, but these devices have failed to gain traction, falling short of sales targets in the US. This is likely due to a number of TV networks withdrawing support for Google TV after Google failed to negotiate agreements with them.

The smart TV market was a sector that Intel CEO Paul Otellini focused on as a potentially lucrative expansion of Intel's chip business. Given Google's success with Android and the boom in the smartphone and tablet sectors, it's not surprising that Otellini expected something similar to happen with Intel supported Google TV products.

Another problem is that the major TV makers were not enamoured by Intel's chips. Top TV makers like Samsung and Panasonic have their own chips, which means that Intel was always going to have a relatively small choice of potential customers for its TV chips.

While this decision might be seen as a failure on Intel's part, it is probably wiser for it to make the move now rather than invest more in a market that is unlikely to improve much for the company. A bigger problem for Intel might be that with companies like Samsung making their own smartphone and tablet chips, Intel could have similar difficulties in those markets too. µ