Intel is now helping vendors like Cherry Mobile Create sub-$50
Android phones.
Spreadtrum, of which Intel has a stake, is also helping vendors
create $22 Firefox OS smartphones.
Due to Apple’s enthusiastic support for mobile browser ad
blocking on iOS devices, Google has urgent need for greater Android
One phone sales.
The Android One project was intended to expand the mobile
advertising channels of Google (NASDAQ:
GOOGL). The pure Android OS in Android One
phones was to guarantee that no Android OEM partners will try to
steal advertising eyeballs from Google. The enthusiastic support of
Apple (NASDAQ:
AAPL) for iOS Safari ad-blocking makes it more
urgent for Google to further increase the presence of Android One
smartphones in the world.
While Google sells premium handsets $275 stock Android OS phones
like the
Nexus 5, it also tried to
popularize $100 Android
Onehandsets in India last year. Unfortunately, the
MediaTek-powered Android One phones from Google's OEM partners in
India
failed to attaincommercial
success.
The low market appeal of $100 stock Android OS phones prompted
Google to reboot its plan. It now intends to propagate Android one
phones with
$50 price tags. The problem now
is MediaTek has yet to offer a processor to make it possible for
Android One phone manufacturers to meet the new $50 Suggested
Retail Price (SRP) of Google.
OEMs Will Find $50 Android One Phones Will Only Benefit
Google
While Micromax and Spice agreed to play minions to Google's $100
Android One ambition, those two India-based firms will find it very
hard to make a profit in selling $50 stock Android OS handsets.
Unless Google offers Miramax cash incentives or ad revenue sharing,
there is no compelling reason for it to support the $50 Android One
idea.
Even if MediaTek supplies super cheap processors, Miramax would
still rather sell its own brand of $50 Android phones and get paid
by third-party companies to pre-install their apps. This is more
financially viable than giving Google's Android One project a free
ride.
Hiring Intel To Help It Launch Its Own $50 Android One
Handset
The better solution therefore is for Google to ask for help from
Intel (NASDAQ:
INTC) . Like its approach with the Nexus,
Google will just have to go all-in on its $50 Android One phone
project. Google only needs to hire one or two sub-contractors to
build its own $50 Android phone. LG or Huawei could assemble the
$50 Google phone and use Intel's super cheap Atom x3
processors.
I'm proud to report that my country's biggest smartphone vendor,
Cherry Mobile, has teamed up with Intel to
create an Android phone using the 3G-enabled
Atom x3 processor. The Cherry
Mobile
MAIA Fone i4has a SRP of only
1,999 pesos ($43).
Cherry Mobile is Google's official partner for Android phones
here in the Philippines. After the initial success of the first
$100
carrier-backedCherry Mobile One Android One
handset, Google asked Cherry Mobile to release the more expensive
$130 G1Android One handset last
month.
Google also recently launched the $190 BQ Aquaris A 4.5 Android
One smartphone in Spain and Portugal. I support Google's move to
offer higher-priced Android One handsets. However, I still say
Google has a compelling reason to make its $50 Android One phone a
reality.
The more people that uses a stock Android OS device, the more
advertising eyeballs that Google could own. Intel and Cherry
Mobile's $43 Fone i4 could serve as a template to create a little
more expensive Android One version using the Atom x3.
I believe that a $7 more expensive version of the Fone i4 will
give it 1GB of RAM. More RAM should boost its performance as a
stock Android OS device. Asustek (OTC:
ASUUY) has had great success with Intel-powered
Android phones since last year. Intel's 64-bit virtualization of
Android has helped Asus create 1GB RAM-equipped phablets and phones
that run fast even under Asus's Custom User Interface and usual
bloatware of its own pre-installed apps.
I hope Google will soon trust the 28nm 64-bit Atom x3 SoC that
ARM-based semiconductor firm
Rockchip helped design. Intel
and Rockchip has created a dirt-cheap x86 mobile processor that is
as energy-efficient as any MediaTek entry-level ARM processor.
But just in case Google is still not fully convinced that an x86
chip from Intel could perfectly run on stock Android One phones,
there's the Spreadtrum ARM-based processors. Intel
owns 20%of Spreadtrum's parent
company, Tsinghua Holdings.
I'm sure Google and Intel can persuade Spreadtrum to sell its
entry-level 64-bit ARM-based chips for $50 Android One phones.
Cherry Mobile is using Spreadtrum's single-core 1.0GHz Spreadtrum
SC6821 processor to help it create the 999 pesos only ($21.5) Fire
OS smartphone, the
Cherry Mobile Ace.
I believe a single-core Spreadtrum SoC could decently run stock
Android 5.0 OS if Google will give it at least 1GB of RAM. The
threat of Fire OS smartphones is bigger than Samsung's (OTC:
SSNLF) Tizen platform.
Unlike Samsung, which is still by its lonesome on Tizen,
other companies
are actually really selling Fire OS phones. The $50 Android One
mission of Google is therefore also a defensive manuever against
dirt-cheap Firefox OS smartphones.
Conclusion
Intel's x86 chips helped Google Chromebooks win big in the
education market. This is the peerless advantage of using x86
processors - they are compatible with almost any modern operating
systems. Google knows all too well that Microsoft (NASDAQ:
MSFT) is ignoring the Atom x3 and Atom x5 for
its Lumia smartphones.
Google could really negotiate an advantageous supply contract
with Intel because that chipzilla is desperate to increase its
market share in smartphone application processors. Microsoft
continues to rely on Qualcomm (NASDAQ:
QCOM) Snapdragons for its entry-level sub-$100
Lumia phones.
I would appreciate if Google will use Intel's dirt-cheap Atom
processors to counter the threat of $80 Windows 10 Lumia phones
with $50 Android One handsets. Nadella's shift toward freemium
strategy requires Microsoft to be more like Google. Microsoft wants
to sell as many Windows 10 devices as possible for data gathering/
advertising purposes.
Microsoft aims to have 1 billion Windows 10 devices as soon as
possible. Nadella's ambition further aggravates Google's future in
mobile. Windows 10's free licensing adds to the threat of the iOS
platform, which is now increasingly being antagonistic over
Google's multi-billion dollar income from advertising to
iPhone/iPad users.
The person who could only afford a $50 Android phone is still a
precious pair of real advertising eyeballs. Google needs the $50
Android One handset to further increase the 1.4 billion people who
already has an Android device. Unlike Apple, I do not think Google
will ever allow greedy third-party browser extension developers to
make selling ad-block tools on Android One devices.
I rate GOOGL/GOOG as
a Buy. This advertising behemoth's stock has
outperformed its mega-cap peers this year. The majority of
investors believe Google was and still is the grandmaster when it
comes to digital advertising.
(Source: Getaom.com)
After the Microsoft snub, I was wrong to say that Intel’s Atom
x3 will only get bought by Chinese white-box phone vendors.
Cherry Mobile, the largest smartphone vendor in the Philippines,
is using the Atom x3 for a sub-$50 Android phone.
SNS Network, a Malaysian firm, has also released an Atom
x3-powered Android phone.
The Atom x3 is perfect for Google's ambitious $50 Android One
smartphone project.
Cherry Mobile, the
biggest vendorof smartphones in
the Philippines,
recently launchedtwo new tablets
and one Android smartphone powered by Intel's (NASDAQ:
INTC) Atom x3 processors. The new MAIA brand of
tablets and phone from Cherry Mobile is exclusively using Intel x86
processors.
I was therefore wrong to think that since Microsoft (NASDAQ:
MSFT)
snubbed the Atom x3for its
latest Lumia 550 entry-level Windows 10 phone, Intel's 3G-only Atom
x3 would only have Chinese phone manufacturers for a client.
Cherry Mobile's launch of the MAIA series helps fortify my faith
over Intel's future in smartphone application processors.
Partnering with Cherry Mobile and local brands that are successful
in their respective countries, gives Intel a chance to sell some
more of its 3G-enabled Atom x3 chips.
(Source: Cherry Mobile)
Intel Has A Great Partner in Cherry Mobile
Cherry Mobile first teamed up with Intel last year with Windows
tablets and smartphones. The Intel-powered Cherry Mobile
Alpha Morphand Alpha Play
Windows tablets were very successful here in the Philippines. What
I can surmise now is that Intel likely told Cherry Mobile to create
the MAIA branding to help distinguish Atom x86-powered devices from
Cherry Mobile's other ARM-based Android devices.
The MAIA Fone i4 is a 4-inch Android 4.4 OS dual-SIM smartphone
with 512MB of RAM and 4GB ROM. It has a microSD slot, dual camera,
and 3G HSPA+ connectivity. It uses the 28nm 1.0 GHz quad-core
64-bit Atom x3 SoC made by Rockchip.
(Source: Cherry Mobile)
The MAIA Fone i4 retails for 1,999 pesos ($43) in Manila. The
MAIA Fone i4 is therefore much cheaper than the cheapest Qualcomm
(NASDAQ:
QCOM) Snapdragon-powered Windows smartphone,
the
$86 Alpha Neon, also from Cherry
Mobile.
The 2,999-peso ($64.5) MAIA Pad is a 7-inch Android tablet with
1GB of RAM and Atom x3. It is almost as cheap as Amazon's (NASDAQ:
AMZN) $49.99 Fire Tablet. Yes, Intel is
unlikely to be making any money from supplying chips to these two
budget Cherry Mobile MAIA gadgets.
However, the third one, the 8-inch MAIA Smart TAB is a dual-OS
Windows/Android tablet that uses the 22nm Bay Trail
Atom 3735Fprocessor. Intel has
stopped givingdiscounts on Bay
Trail tablet processors. The MAIA SMART Tab therefore might be
accretive to Intel.
The obvious savings offered by a dual-OS tablet product will
endear it to budget-conscious buyers. The 4,999 pesos ($107) MAIA
Smart TAB is highly likely to become another huge hit here in the
Philippines. The Windows 8.1/Android 4.4 feature of this 8-inch
Intel-powered tablet makes it great for media entertainment, gaming
and office productivity.
I dare opine that the dual-OS flexibility of the MAIA SMART Tab
makes it a better value-for-money purchase than the
$300Apple (NASDAQ:
AAPL) iPad Mini 3. Unlike Apple, Cherry Mobile
gave it 2GB of RAM, a microSD expansion slot, USB OTG support, and
32GB of internal flash storage.
(Source: Cherry Mobile)
This dual-OS tablet product is also special because Cherry
Mobile is the
official partnerof Google
(NASDAQ:
GOOG) (NASDAQ:
GOOGL) for Android One smartphones in the
Philippines. Google
intensely dislikesdual-OS
devices but Cherry Mobile still went ahead with the SMART Tab.
Intel's close relationship with Google likely helped Cherry Mobile
get away with the dual-OS nature of the SMART Tab.
Yugatech experts already said this cheap device is qualified for
a free upgrade to Windows 10. They bought a MAIA SMART Tab and
successfully upgraded it to Windows 10.
(Source: Yugatech)
The MAIA Smart TAB is therefore the better gadget to buy than
the $132 Intel Atom x3-powered but Android-only
Asus ZenPad 8Android tablet. The quad-core Intel CPU and 2GB of
RAM will let the SMART Tab run Photoshop CC and any other Windows
software.
Filipino-owned Cherry Mobile is often considered as the Xiaomi
of the Philippines. It was able to dislodge Samsung (OTC:
SSNLF) as the Philippines' top vendor of phones
by coming up with budget-friendly (but good quality) smartphones.
Intel's management is smart enough to partner with the country's
most successful phone vendor.
Samsung and Microsoft continue to snub the x86 Atom mobile
processors anyway. It will be sweet revenge for Intel to help local
vendors kill the sales of sub-$100 phones of Samsung and Microsoft.
The Philippines is now the
third largestmarket for
smartphones in South East Asia.
IDC estimated that my country registered a 76% Year-over-Year
growth in smartphone sales last year. Out of the 26.8 million that
got shipped to the Philippines, 47% of it were smartphones.
26.8 x .47 = 12.596 million
Out of that 12.6 million smartphones, Cherry Mobile contributed
21.9%.
(Source:
IDC)
Intel is smart enough to exploit the popularity of Cherry
Mobile's brand. The reality now is that global brands like Samsung
are no longer dominant in some emerging markets. MyPhone and Torque
are also local smartphone companies owned by Filipinos that are
stealing sales from Samsung handsets.
Just like in India and China, Samsung lost its sales leadership
to local brands Micromax and Xiaomi. The partnership with Cherry
Mobile is a great example of Intel's willingness to collaborate
with successful Asian/European local brands.
SNS Network of Malaysia also used the Atom x3 inside its
JOI Phone 5and JOI LITE 7
Android tablet. Just like Cherry Mobile, SNS Network first ventured
with an Intel-powered 2-in-1 Windows 8.1 tablet. This eventually
led to SNS Network branching out to selling Android phones with x86
Atom chips.
Another non-Chinese OEM client of the Atom x3 is KIANO of
Poland. The KIANO
SlimTab 7 3GRuses the Atom
x3-C3130 CPU. It also has 1GB of RAM, 8GB of ROM, and runs on
Android OS 5.1.
Intel is unlikely to quit the smartphone processor business
anytime soon. As long as there are successful local vendors that
trust the x86 Atom for their products, Intel will only get
emboldened to produce better smartphone processors. Microsoft and
Samsung are making a big mistake in ignoring Intel Atom chips.
In the long run, those two global brands will get slowly killed
by agile local brands that are able to offer cheaper phones using
Intel-made processors.
As per the example set by the sub-$50 Cherry Mobile MAIA Fone
i4, the Atom x3 processor might be the key piece towards Google
fulfilling
its dreamof selling $50 Android
One phones for emerging markets.
Google already
failedwith its first generation
of MediaTek-powered $100 Android One smartphones in India. Coming
up with a $50 Android One version of the Intel-powered MAIA Fone i4
might be Google's saving grace.
I again reiterate my position that Intel should quit wooing the
elusive Microsoft Lumia business. Intel instead should do its best
to get inside Google's Android One global campaign.
INTC is a Buy.
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