RIM, INTEL UNVEIL LONG-AWAITED DEAL
CHIPS FOR WIRELESS DEVICES BlackBerry maker promises ‘ snappy performance’
Research In Motion Ltd. and Intel Corp. unveiled a highly-anticipated partnership yesterday, a deal that will see the BlackBerry maker use the computer chip giant’s processor in future wireless e-mail devices.
The new BlackBerry, which may be named the Electron, will run on high-speed data networks called Enhanced Data Rates for Global Evolution.
The device will contain a new cellphone processor, nicknamed Hermon. It will be released this year. Financial terms were not released.
Mike Lazaridis, co-chief executive of RIM, said users will notice a “snappy performance” because the BlackBerry will process Web pages, attachments and heavy-duty software programs more quickly than previous versions.
“ Things will appear instantaneous in many ways,” he said in an interview from San Francisco.
Mr. Lazaridis said he likes Intel’s new processors because they consume very little power, a necessity for the legions of addicted “ CrackBerry” customers who pound away on the devices all day.
RIM needs Intel’s help to stay ahead of new competitors, a group that includes Microsoft Corp., Motorola Inc. and Palm Inc., which are expected to release competing devices over the coming months. Microsoft and Palm announced the Treo 700w device on Monday. Motorola and Microsoft are going to release a device, nicknamed Q, in the first quarter of next year.
Intel, whose Pentium chips power nine out of 10 personal computers, needs RIM’s help to break into the burgeoning wireless market, an area of expertise for RIM.
The RIM-Intel deal also likely means Motorola has been turfed as the BlackBerry’s main chip supplier.
A broad collaboration involving RIM is not surprising. Intel Capital, the chip maker’s venture capital arm, was an investor in the company. Intel also supplied the processors for the first BlackBerry.
The talks between the companies, which lasted about two years, were first reported in the Financial Post
in July.
RIM shares jumped 6% on Aug. 22 on speculation the companies were about to announce the deal during the Intel Developer Forum, a semi- annual event.
In a release, Intel and RIM said they will continue working together to develop new technologies and handset features. Mr. Lazaridis would not provide specifics.
Brian Sharwood, a SeaBoard Group consultant, said the companies could develop WiMax technology, a nascent longrange wireless standard that could help BlackBerry users send and receive e- mails from more places.
RIM may already be licensing patented wireless and battery technology to Intel, observers say.
“ There is more to this deal than meets the eye,” said Peter Misek, a technology analyst with Canaccord Capital.
Two weeks ago, Intel said it will spend US$190-million to expand a facility in Colorado Springs, Colo., so it can make communications products for laptops with enhanced wireless Internet ( Wi-Fi) access and better battery life.
Mr. Misek said the companies may not be ready to talk about the full relationship because of the ongoing high-stakes legal spat with NTP Inc., a small patent-holding firm based in Arlington, Va.
“ We doubt that Intel would want to formally expose itself to this lawsuit.”
NTP, which was formed to protect the patents of since-deceased inventor Thomas Campana Jr., first sued RIM for patent infringement in 2001. A U. S. jury partly agreed with NTP and awarded it US$53.7-million in damages, 8.55% of future BlackBerry sales and a sales injunction against RIM in the United States. The injunction was stayed pending appeal.
RIM and NTP reached a tentative US$450-million agreement this year but the deal fell apart three months later. RIM wants a U. S. court to enforce the agreement. A decision is pending.
The U. S. Patent and Trade
Office has also issued First Office Actions that overturned most of the issued patents to NTP. If the decisions are upheld, NTP’s case would be declared null and void. RESEARCH IN MOTION LTD.
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