The only hope for Intel is to knock ARM off its pedestal. But Atom doesn’t cut it. Atom is based on the last 30 years of Intel processor development and support for Microsoft code, and has all sorts of legacy circuitry that goes along for the ride. Thus, it’s big and power hungry – a rather unfortunate combination for the power and cost sensitive mobile computing market. The only hope for Intel is to take ARM on at its own game. It could try to develop the capability on its own, or it could jumpstart its efforts by acquiring a known player who’se already worked out all the technical difficulties of making CPU technology that is flexible enough to be stuffed into a larger chip design (something for which Atom is simply not suited.) MIPS is really the only viable choice to buy – no one else is large enough or technically competitive enough.
So – that’s why the MIPS acquisition by Intel has been rumored since the beginning of the year.
SEPTEMBER 12, 2011, 4:30 PM ET
MIPS: Starboard Mostly Right, Says The Benchmark Co.
By Tiernan Ray
Shares of microprocessor architecture licensing company MIPS Technologies (MIPS) today rose 31 cents, or 6%, to close at $5.48 after its largest investors, Starboard Value LP, said it sent a letter to the company’s CEO and its board of directors stating the stock is “deeply undervalued” and offering nominees for the board.
Starboard, which claims to hold 9.1% of the shares outstanding, write that the stock has had a “dismal” performance since the company’s IPO in 1998 — down 69% since then, and down 37% in the last five years.
“According to Starboard, this destruction in stockholder value is a direct result of the Company’s weak operating performance, deteriorating margins and poor capital allocation decisions around internal investments and poorly executed acquisitions,” the letter relates.
Starboard nominated four directors and urges the company to “explore alternatives” to unlock the value of its chip intellectual property. It also urged the board to stop buying companies, which it says has been a failure, and instead spend money to buy back shares.
The Benchmark Co.’s Gary Mobley this afternoon published a note to clients in which he concurs with many of Starboard’s points, while reiterating a Buy rating and an $8 price target.
Many of the board members have been there since the IPO, notes Mobley, and “we have heard the board is one of the deficiencies of the company.” He agrees with the suggestion the company cease acquisitions and buy back stock.
“We do, however, feel that MIPS should continue to invest in mobile,” writes Mobley. “While the company has not closed any tier-one mobile licensees, it has gotten some traction at the ground floor with 10 mobile licensees to date. Mobile represents a large addressable market and represents the most logical way for MIPS to expand outside of its historical digital home realm.”
I doubt Intel will buy mips. Intel owns the X86 instruction set. Intel is all about expanding the X86 instruction set everywhere. They are not interested in ARM or MIPS instruction set and would rather see them fail. They fell behind in makeing low power versions of their X86 technology. In their mind, they dont see any problems in eventually catching up and actually blowing the competition away. The competition is not really very powerfull. Its simply low power. Thats why they didnt buy ARM.
Intel does have alot of cash on hand. Billions. And MIPS market cap is around $437M. Could easily be bought out. But the question is - Would it be overall beneficial for Intel to acquire MIPS...?
Your post is silly.
Here's my silly idea: If Intel made a 32 bit version of Alpha, Intel would have done well in mobile devices. No kidding. Alpha and MIPS are very similar. Intel has the rights to Alpha after its purchase of Digital Equipment semiconductor business.
rumored by idiots who do not understand the semiconductor ip business.
intel is not buying mips. not gonna happen.
all this buyout speculation started when larry ellison said he was going to buy semiconductor ip. a retarded analyst/blogger speculates that mips is a target even though there is absolutely no reason for oracle to buy mips.
Mr. Softy (MSFT) has already reprogrammed, reformatted, debugged, and rebooted whatever else they have to do to get their Crappy Windows mobile os to work on ARMH's architecture.
Slow death for Intel. Very good for ARMH and eventually MIPS.