Intel began developing chips for other companies.

For the first time in its history, Intel has agreed to the production of chips for other companies in its most modern factories. This step of the company is aimed at capturing that part of the chip production market, which is now dominated by Taiwanese and Chinese companies.

Starting next year, Intel will be building chips for Achronix Semiconductor , a small Silicon Valley company that develops specialized microprocessors used to speed up computing tasks, such as network traffic management and data encryption.

The terms of the contract, which both companies plan to make public in the near future, will require Intel to abandon only a small part of their production capacity, but this is undoubtedly a serious step for a company that has traditionally engaged in the production of chips only for its own needs.
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Despite the fact that this transaction involves only 1% of the company's capacity, some analysts believe that this is only the beginning, and they see in this step a hint that Intel plans to take a larger share of the market for custom-made chips. Intel has long believed that they are far ahead of other companies in the market for creating electronic chips, producing chips with smaller components than competitors. Their chips are more productive, more economical and cheaper than the products of competitors. Intel owns many multi-billion dollar factories around the world, which develops chips on its own. Meanwhile, some factories, mainly in Taiwan and China, specialize in the manufacture of custom-made microchips developed by other companies. These plants are involved in a tough and costly competitive struggle for such customers as Apple, Nvidia, AMD. Intel plans to develop new markets with the help of other chip developers, thereby offsetting the costs of its enterprises.

Many analysts describe this move by companies as an attempt by Intel to try something new in the business, before changing its principles, taking orders from other chip developers. Achronix, a small player in the FPGA (field programmable gate array) chip market. These chips are optimal for quickly solving specialized tasks, so they quickly found their niche in the chip market. Companies use these programmable chips for various purposes: to speed up the operation of switches and routers, in digital signal and video processing systems, to accelerate financial calculations on Wall Street and the processing of geological data by oil and gas companies. The global FPGA market is about three billion dollars, and this is only one-tenth of Intel's annual revenue, and the company is not competing in this market at this time.

The company hopes to gain some experience in creating products for other developers, without much changing production lines. The company may have to face certain difficulties, as it will have to meet the needs of external customers for the first time. This move could increase Intel’s competitiveness in the FPGA market, which is dominated by Xilinx and Altera. Both companies are engaged in the production of proprietary chips under contracts. Achronix believes that a deal with Intel can help the company create cheaper and faster products than its competitors and expand the market for these chips.

FPGA chips were too expensive, the cost per unit was in the range of one thousand dollars. Achronix plans to sell them at 400. Cooperation with Intel will allow the company to avoid many costs, increase competitiveness and capture a significant part of the market. But some analysts are not so optimistic and believe that it will not be so easy to press Xilinx and Altera.

via NYTimes