Intel Broadens Smartphone Push With Acer Liquid C1

The Acer device is the latest overseas move by Intel to gain traction in the booming smartphone chip market now dominated by ARM.

Intel is continuing its push into the mobile chip space with the launch in Thailand of a new smartphone from Acer powered by Intel's new low-power Atom Z2420 processor, code-named Lexington.

Officials from Intel and Acer unveiled the new phone, the Liquid C1 smartphone, in Thailand Jan. 31, saying they expect the $335 device to hit store shelves in other countries in Southeast Asia over the next few months. The phone, which runs Google's Android, is the latest device from Intel to launch in overseas markets as the company looks for a foothold in the highly competitive mobile device market, where the predominant chip platform is from ARM Holdings.

The announcement comes just weeks after Intel executives unveiled the new Atom Z2420—and a number of other processors—at the 2013 Consumer Electronics Show. At the time, Mike Bell, vice president and general manager of Intel's Mobile and Communications Group, said in a statement that the release of the chip "enables Intel to address new market segments and further rounds out our expanding portfolio of smartphone offerings."

Originally aimed at the then-growing netbook market, Intel's Atom platform is now the foundation of the vendor's smartphone efforts. Over the past year, Intel has announced a number of smartphones running on its processors, with all of those devices aimed at markets overseas. Lava International's Xolo 900 was released last year into the Indian market, while Orange's San Diego targeted the U.K., and devices from Lenovo and ZTE are selling in China and Europe.

In September, Google's Motorola Mobility unit introduced the Intel-powered Razr i, a reconfiguration of the company's Razr M. The Razr i started selling last fall in Europe and Latin America. Most recently, Intel this month introduced the Yolo phone, another phone powered by the Atom Z2420 and the first launched in Africa. The device will sell first in Kenya from the Safaricom company and will start at $126.

Acer's Liquid C1 reportedly comes with a 4.3-inch screen, long battery life, an advanced graphics engine and an 8-megapixel camera.

Intel officials are looking to emerging markets overseas as prime avenues for getting into the smartphone market, though some analysts said the key to determining Intel's long-term success in the market will be how well the chip maker does with Intel-based phones in the United States.

An important part of the company's U.S. strategy is ramping up the 4G Long-Term Evolution (LTE) 4G capabilities in its mobile processors. That was a driver behind Intel's 2010 $1.4 billion deal to buy Infineon's mobile chip business. During the Jan. 17 conference call with analysts and journalists to talk about fourth-quarter and 2012 financial numbers, Intel CEO Paul Otellini said the company has begun shipping its "single-mode data LTE basebands" and will begin delivering multi-mode data and voice modems over the course of 2013.

"Infineon is doing well," Otellini said. "They are well on their way to an LTE solution. … First LTE phones, I would expect to have launched early next year. … We believe we have a very competitive solution. The Infineon team is known for not necessarily being first to market, but being really good at engineering a very solid solution and being cost-effective and cost-competitive. … In terms of integrated solutions, you'll see higher levels of integration from us next year."

Gaining traction in the mobile chip business will be increasingly important to Intel going forward. The vendor—like other tech companies with tight ties to the PC industry—has been hurt by the contracting sales in the worldwide PC market. Intel executives said that revenues in the company's PC client business were down 3 percent last year.

Intel officials are confident that the company will become a significant player in the mobile chip business. However, the competition is steep. ARM designs are found in the bulk of smartphones and tablets, and ARM-designed chips are built and sold by the likes of Nvidia, Qualcomm and Samsung Electronics.

Still, Intel executives say they are encouraged by what they've done so far, and by the response and interest from device makers. During the Jan. 17 earnings call, Intel Chief Financial Officer Stacy Smith noted the number of Intel-based phones on the market, adding that a "third-party benchmark shows that we are not only capable of matching the competition in power efficiency, we are leading them. … The thing I'm struck by in this space is how hungry it is that the customers are to work with us in this space, so I think it's a nice combination. We got a good roll of products across the year and it looks like people are really lining up to have us as one of their key partners."