Thread regarding Intel Corp. layoffs

Why Broadcom gave up on IOT (and why Intel will fail miserably at it)

This article nailed it. I was one of the founding engineers of this product line.

The volume just wasn't there for margins of these things. With the exception of automotive (which Qualcomm/CSR has it locked down for most major OEMs), IOT margins are pretty low. And if we thought those margins were low, being use to margins in connectivity much lower than app processors, Intel is going to have even a bigger problem... Margin and volume just isn't there, except automotive

Both Broadcom and intel made the mistake of NOT buying CSR and letting Qualcomm buy it. CSR pretty much owns automotive connectivity and high fidelity wireless audio. Automotive has the issue that once you own the SOC, it's pretty hard for a competitor to unseat you, because things take so long to get into production, that Auto OEMs don't really want to switch one supplier out after it's already in there.

http://www.fool.com/investing/general/2016/05/09/why-did-broadcom-ltd-quit-the-internet-of-things.aspx?source=yahoo-2&utm_campaign=article&utm_medium=feed&utm_source=yahoo-2

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| 2922 views | | 7 replies (last May 10, 2016) | Reply
Post ID: @OP+Hkaqotx

7 replies (most recent on top)

IoT reminds me of 85xxx based USB peripheral controller business Intel planned to enter. The day before Intel's launch a competitor launched/advertised a sub-$1 peripheral controller. That torpedoed Intel's plan as well as the career of a rising star GM (insanely brilliant guy that had 5 back-to-back promos in under 7 years). However the processing power and SW compatibility requirements and fragmentation of ARM-IoT controllers is pure wind in the sail of Intel and it will roll-in significant market share here (beyond traditional embedded space).

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Post ID: @nuf+Hkaqotx

That's why Wind River did so well for awhile. They charged an unreal amount of $$ for a license, per seat, then they added on professional services contracts to help with development.

Now, most of that work is done in their engineering development centre in China. The employees here are glorified salesmen and women. If Intel keeps any part of Wind River, it will be the China engineering development centre, not the Alameda, Ohio or other campuses.

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Post ID: @jtr+Hkaqotx

IOT is just Intel old embedded business. Doesn't sound as sexy

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Post ID: @xgg+Hkaqotx

The Chinese owns the IOT market.

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Post ID: @oye+Hkaqotx

The entire tech industry (save for the industry disrupters) is in suspended disbelief. The tech bubble is near bursting, again.

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Post ID: @uzt+Hkaqotx

Ha-ha. At the end of the day, it looks like Intel will be down to three pillars and more layoffs in IoT. Krzanich is an idiot.

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Post ID: @ahh+Hkaqotx

The main issue here, which you can confirm with anyone else that has seriously dealt with IOT, is that the IOT hardware is such a low margin business (sub-$1). At the same time, unlike winning mobile SOCs, where you have a huge volume order in the millions, most of the products that are interested in an IOT solution are about a few hundred thousand at best. True, there's many startups and small companies that say that they are interested in IOT, but reality is that there's no way a large company banking on volume will be able to hand - hold these small companies because it would be too resource intensive and costly, more so than the margin*volume a large company can make from this.

Actually, as an embedded engineer and apps engineer that is familiar with the connectivity software and hardware with mobile platform software experienc, your skill is in pretty high demand because the chip companies that make these things don't have the support and aren't willing to spend a lot of time and money to hand hold all these startups and small companies that want to do something IOT related. That's why I've got offers from so many startups up the nose, that I'm considering NOT being a full time employee and instead doing a contracting business. Because, just like when smartphone O/S like iOS/Android came out, no one else knew how to do it. So for the brief 4-5 years when average joe doesn't know how to engineer these things, you can make a killing with your experience.

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Post ID: @lne+Hkaqotx

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