Most everyone knew, or at least expected, that Intel had plans to integrate 5G into its standard PC platforms at some point in the future. But until today, no one knew for sure exactly how it might do so or who might be Intel’s potential partner in this endeavor. There had been speculation that Intel would create a 5G modem itself, because the much-publicized sale of its modem business to Apple only consisted of assets and technologies related to smartphones. As a result, there was a theoretical possibility that Intel could make modems designed specifically for PCs and, eventually, even build them into future versions of CPUs or larger SOCs (system on chips—integrated chips that incorporate multiple discrete elements, such as CPUs, graphics-oriented GPUs, etc.)
Instead, in a move that caught many off-guard, Intel has announced that it is partnering with Taiwanese chipmaker MediaTek for 5G modems and will be using MediaTek-branded modems in future PC systems, starting in early 2021. While it’s great to finally hear Intel make a definitive announcement about its vision for 5G in PCs, there’s no denying the announcement was a bit surprising on several fronts, including the choice of partner and the later-than-expected timing.
Since Qualcomm is the biggest player in 5G modems, some people are probably surprised that Intel—after deciding not to move forward with its own 5G modem (at least for now)—didn’t choose to work with Qualcomm on future 5G PC reference designs.
“Once you scratch through the strategic surface, the decision to go with MediaTek as a 5G partner starts to make more sense.”
Once you scratch through the strategic surface, however, the decision to go with MediaTek as a 5G partner starts to make more sense. First, Intel sees Qualcomm as a competitor in its core CPU business because of Qualcomm’s ongoing Arm-powered PC CPU offerings (such as the current 8CX). These Qualcomm CPUs are in all of the Always Connected PCs (ACPCs), including the new Microsoft Surface Pro X, Samsung’s upcoming Galaxy Book 2, as well as existing offerings from HP, Lenovo, and others. While none of the ACPCs have sold in large quantities to date, many of the early performance issues are being overcome, and the possibility that ACPCs could have a noticeable impact on Intel’s PC CPU business is starting to grow.
Second, Intel likely wants to strengthen competition against Qualcomm’s modems and choosing MediaTek definitely gives more presence and brand value to the Taiwanese company. Of course, even though it isn’t as well-known as Qualcomm, the truth is that MediaTek is a strong player in modems, as well as many other areas, such as smart TVs, smart speakers, and many other categories. The challenge for MediaTek to date has been that its modems are primarily used in mid-range and lower-end smartphones that aren’t widely sold in the US (but are sold in huge quantities in China, India, and many other countries around the world).
Technologically speaking, MediaTek’s 5G modems only currently support sub-6 GHz frequencies (see the 5G Landscape, Part 2: Spectrum and Devices for more on different 5G frequencies and what they mean), and the announced project with Intel will also only support sub-6. Again, this could raise questions about the decision not to go with Qualcomm, whose 5G modems support both sub-6 and millimeter wave (mmWave) frequencies. (Though to MediaTek’s technical credit, all of its 5G modems are multi-mode, meaning that a single modem supports everything from 2G to 5G, whereas Qualcomm’s current 5G modems are only for 5G and require another modem chip for 4G and below.)
At first glance, it would seem PCs would be a great technology match for the ultrafast speeds offered by mmWave, especially because PCs aren’t as mobile as smartphones and often do stay at certain locations for longer periods of time. However, the big downside to mmWave is that the range of the frequency is very limited and, most importantly, doesn’t pass through walls or windows to the indoors, where PCs are more likely to be used. As a result, realistically speaking, sub-6-based 5G service will likely be a better match for PCs for the next several years.
One additional consideration in the modem decision is that AMD—Intel’s primary PC CPU competitor—has already started partnering with Qualcomm for 5G (a partnership that will likely grow stronger because of Intel’s announcement). So once again, competitively speaking, the most realistic partner for Intel was MediaTek.
From Qualcomm’s perspective, the 2021 timeframe of the announcement means that the company has more than a year to work with PC partners—even those using Intel CPUs—to put 5G modems into PCs. In fact, quite a few PC vendors are planning to bring 5G-equipped PCs to market in 2020, and virtually all of them are going to be using Qualcomm’s 5G modems.
The reality is that it’s still very early for 5G. Plus, as long-time PC industry watchers know, cellular modem penetration into notebook PCs has never garnered more than a few single digital percentage points. There are some who might say that this is much ado about nothing. However, the perceived value of an always connected PC—whether it’s running an x86-based CPU or an Arm-based one—is definitely starting to grow.
Plus, the telco carriers are starting to show more interest in getting PCs and other devices onto their networks. In particular, they’re getting more rational about their pricing for extra device data plans, which had been a huge detractor for cellular-equipped PCs in the past. Now that the smartphone market has stalled, and even started to shrink, in some markets, telcos are hungry to keep their businesses growing, and connected PCs look like an intriguing option. Toss in the potential for increased speed (in most cases—see Real World 5G Speeds Are Slower Than Expected) and new capabilities that 5G will eventually offer, and there’s little doubt that 5G-equipped PCs will start to become mainstream in the not-too-distant future. When that starts to happen, all of this will start to matter a whole lot more.
Forbes columnist Bob O’Donnell is the president and chief analyst of TECHnalysis Research, a market research and consulting firm that provides strategic consulting and market research services to the technology industry and professional financial community.