Can QUALCOMM Challenge Intel in PC Processors? (INTC, AMD, QCOM, ARMH, MU, AAPL, GOOG, RIMM)

Intel Corporation (NASDAQ: INTC) has an extreme dominance when it comes to the market share of processors inside of personal computers, generally referred to as about 80% depending upon your source and depending upon which month you pick.  Advanced Micro Devices, Inc. (NYSE: AMD) is so far behind in that effort that Intel is often considered a near-monopoly in processor chipsets for PCs.  This lead and dominance may soon be challenged now that the world has begun its move in the post-PC era.

Smartphones and tablets are the newest trend, much more than personal computers.  There is an issue of “good enough computing” when it comes to processor performance now in traditional PCs.  The 2008 to 2009 trend was the netbook and the smartphone craze.  Now it is the tablet craze along with the smartphone craze.  QUALCOMM Inc. (NASDAQ: QCOM) has a solid position in smartphones with its Snapdragon processor.  ARM Holdings plc (NASDAQ: ARMH) has been a success with its architecture in smartphones as well.

Intel recently acquired McAfee for additional security bundles but more importantly it acquired Infineon’s Wireless Solutions Business. That is a move for smartphones and mobility devices and a move which may be a long-term win for ARM.  Intel has maintained that it is committed to serving the Infineon WLS existing customers, including support for ARM-based platforms.  Intel’s purchase expands its Wi-Fi and 4G WiMAX offerings, and the acquired technology should be used in its Core processor laptops.  It is also expected to be used in Atom™ processor devices such as netbooks, smartphones, tablets, and in embedded computers.

A war of the processors is setting up for 2011 and beyond.  It will probably well into 2011 before Intel is directly competing in the smartphone business as a real player.  QUALCOMM is already in the smartphone devices and is going more after the tablet and mobile markets.  Don’t discount Apple Inc. (NASDAQ: AAPL) in the race for processors and chipsets either.  It is now using some of its own architecture rather than Intel’s.

An issue to consider for PCs now is the availability of higher and higher DRAM.  That was always an issue, but now companies like Micron Technology, Inc. (NASDAQ: MU) have dirt cheap and high-powered DRAM chipsets for PCs.  The move is going to be into more and more mobile computing, and that is smaller notebooks and netbooks, tablet PCs, and in smartphones.  Apple Inc. (NASDAQ: AAPL), Google Inc. (NASDAQ: GOOG), and Research in Motion Ltd. (NASDAQ: RIMM) have assured that the trend will continue.

JON C. OGG