Texas Instruments shareholders want the company to exit the mobile chip business

Texas Instruments shareholders want the company to exit the mobile chip business
We've made it a point to mention how many new smartphones are coming to market with Qualcomm's MSM8960 S4 processor doing the heavy lifting. Integrated chips like the S4 and NVIDIA's upcoming Tegra 3+ are making Texas Instrument's decision to exit the mobile baseband chip market at the end of the year look prescient. By the company's shareholders want more and worry that the tech firm can't compete with handset manufacturer's like Samsung, Apple and even Huawei designing their own chips.

The stockholders would like to see TI exit the mobile chip business entirely. It's once prosperous customers like RIM and Nokia are going through tough times and even a fairly steady customer like Motorola is now using the S4 on its high-end models instead of TI's OMAP line. Bernstein Research analyst Stacy Rasgon says that the company should sell the remaining mobile chip line. While he couldn't come up with a list of buyers, he thinks that just perhaps LG or Huawei could be interested.

With Qualcomm and NVIDIA showing that the future is in "all-in-one" chips, TI's stand-alone chips are not providing the company with the kind of returns that it needs to compete in the business. The stockholders who want TI to exit the business aren't Ma and Pa Kettle with 100 shares. These are the big mutual funds that own hundreds of millions of dollars in TI stock and whose collective buying or selling decisions can move the price of the stock.

Texas Instruments is now selling its OMAP line to other manufacturers, such as those in the automobile business. Shareholders would just like to see the company focus on its profitable analog chips business where it doesn't have to face cutthroat competition and pricing.

source: Reuters

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62 Comments

47. zothen

Posts: 15; Member since: Mar 26, 2012

A couple of things missing here. 1) When a TI SoC goes in a device, it's surrounded by a bunch of TI analog and digital companion parts as per TI's reference design. So your analog business will eventually suffer once other brands get put in the reference designs. 2) Everybody keeps talking about the A15 and how it will perform better than S4, but an equally large part of the story is what parts have the best MIPS/milliwatt. The A7 CPUs that will accompany the A15s in 2013 SoCs will be way more efficient than the S4 when max performance isn't needed, but perhaps the S4 have better efficiency than A15, so OS/software implementation and application context may play a big role in how they compete. TI was the first or second to announce an A15 SoC last year. This latest Samsung announcement is their second or third announcement. I'd expect them to come out within 2 or 3 months of each other. As far as the investors go, shareholders (and thus usually board members) always pressure companies to do what's best in the short term as they only care about meeting their short term goals without an understanding on how this can damage the long term. It seems only very strong founder type CEOs are mostly immune to this idiotic pressure to sacrifice long term for short term gains. The S4's success is well deserved as it is light years beyond S3 and at 28nm the S4 is a good deal better than 40 or 45nm Cortex A9. Of course a 28nm Cortex A9 would also be a good bit better than a 40 or 45nm Cortex A9. Qualcomm's good decision to stick with the RF integration versus TI who sold theirs off is now paying off big time, for now. One thing is or sure.. the coming SoC battles will be fun to watch. I lean towards the best/latest software myself so I'm enjoy my TI OMAP4 Galaxy Nexus and look forward to a variety of Nexus phones later this year.

49. remixfa

Posts: 14605; Member since: Dec 19, 2008

43. pikapowerize

Posts: 1869; Member since: May 03, 2012

i think TI shouldn't exit... they still make good chips... i think if Microsoft will just allow manufacturers to use other chips besides Qualcomm's (i really dont know why they are supper strick to this segement, maybye to avoid the buggyness) they can still make good market!

44. pikapowerize

Posts: 1869; Member since: May 03, 2012

no to mention cheap production... they need to offer it cheaply!

33. master0fursinz

Posts: 104; Member since: Apr 26, 2010

This is like i said before pretty dumb for investors to do. Yes there is huge growing market for mobile chips, alot of competition but you need the right salesman for the job. TI needs a guy to pitch these chips like blue chips at a casino and gain back lost companies. And if they do sell off the division I pray that Google buys it quick. This will help them eliminate the middle man for Motorola Mobility. It will also give them some extra power behind chip patents and impelmentation in Android OS.

22. iCandy

Posts: 46; Member since: Dec 07, 2011

AMD, this is your golden chance...

19. robocopvn

Posts: 504; Member since: Mar 10, 2010

Ti Omap4 is one of th best of A9 CPU (Goolge choose it for Galaxy Nexus). However it's too slow introducing new quad-core A9 and A15dual core. That's why at this moment Ti Omap4 cannot compete with T3 and ExynosQuad and S4 ! And I don't understand TI's investers. They really want to get out of the fastest growing and profitable market ?? sorry for double post , I cannot edit my last one :(

17. robocopvn

Posts: 504; Member since: Mar 10, 2010

Ti Omap4 is one of th best of A9 CPU (Goolge choose it for Galaxy Nexus). However it's too slow introducing new quad-core A9 and A15dual core. That's why at this moment Ti Omap4 cannot compete with T3 and ExynosQuad and S4 ! And I don't understand TI's

16. BattleBrat

Posts: 1476; Member since: Oct 26, 2011

I hate qualcomm, mostly for their radio's subpar reception, I'm saddened to see MOTO's next offering is packing a qualcomm processor, I prefer a Tegra or Exynos....

11. Bluesky02

Posts: 1439; Member since: Dec 05, 2011

Scary shareholders, the mobile phone industry is in a big boom right now and shareholders want to left this booming space to focus on what they do best. I thought in business you have to fight competition.

9. remixfa

Posts: 14605; Member since: Dec 19, 2008

what short sited investors. Get out of the fastest growth vector pretty much in the world right now? What sort of lunacy is that. Especially when their last product was second only to exynos. If they need to retool for all in one solutions, then get to it. Get OMAP5 out and get moving. Screw qualcomm, their chips suck and I'm tired of seeing them in "high end phones" when they are not high end chips. Its not about "samsung fanboy" like people like to proclaim, its about expectations and delivery. Ti has a history of delivering better than everyone but samsung. There is zero reason for them to exit the sector. There is every reason for them to double down though. If all in one is what the sector wants, then make it happen.

10. true1984

Posts: 871; Member since: May 23, 2012

We all know you don't like Qualcomm but we all have to be honest here, right now the have the best dual core chips available in the the market. And if the Pro is compatable with LTE like they say they might be on top until we get performance specs on the Exynos 5

12. nyamo

Posts: 274; Member since: Mar 19, 2011

LTE does not make a phone. many markets over seas do not require LTE to sell a great phone. I for one avoid it like the plauge with ATT's small footprint right now. Next gen technology is not nearly mature enough to force every consumer on to it.

15. true1984

Posts: 871; Member since: May 23, 2012

But in the US it is a big deal, Thats why they care about making phones with LTE capability. If not then my EVO would've had a Tegra 3 instead of an S4. Besides you know they mostly use HSPA+ overseas right?

27. remixfa

Posts: 14605; Member since: Dec 19, 2008

best how exactly? their only benefits are cheap cost and integrated lte. other than that the exynos whips it pretty handily in just about everying from battery to gpu. it manages to only be a hair better than the tegra 3 in some tests. the pro puts it barely above the a9 exynos quad in gpu.. it still cant keep up with the a15 exynos at all nor the proposed omap5. i dont put heavy consideration on LTE. battery and horsepower are way more important.

30. true1984

Posts: 871; Member since: May 23, 2012

the exynos in the galaxy note cannot out perform the s4. the quad core in the international version destroys the s4 but gets destroyed by the s4 pro. the s4 pro basically beats any mobile processor on the market right now, that's why i said it'll be on top until the exynos 5 comes out. and i havent seen any specs on omap 5 so i'll concede to that point. also like i said before us carriers are putting heavy emphasis on lte. and the last exynos was capable of lte, samsung didnt use it because the s4 was more powerful.

32. dmckay12

Posts: 243; Member since: Feb 25, 2012

It has one killer feature...It is on the market. The S4 Pro will be in phones months before the A15 quads are in phones (Samsung said that their Exynos quads will only be in tablets).

37. remixfa

Posts: 14605; Member since: Dec 19, 2008

A15 quads havent been announced yet. Its A15 dual. Samsung said that their exynos 5250 A15 will be in tablets FIRST and then into phones.. not exclusively to tablets. Its a production supply issue. Sell it through tablets while they ramp up production for phones which sell exponentially more. That also doesnt mean that they could just be being funny and introduce it in everyone's favorite phablet, the Note2 which is to be unveiled this month some time... Not a big chance, but ya never know.

39. dmckay12

Posts: 243; Member since: Feb 25, 2012

My point is that they haven't even been announced. The S4 Pro will be in things is the next few months, but the A15s are still in planning stages. Chances are that the A15 duals will be slightly behind it. The GPUs might be slightly better, because they will be newer, but the processors themselves will be behind.

40. MISTER.H

Posts: 167; Member since: Aug 03, 2012

I believe that ARM themself have a A15+ 8 core which runs at 3.0ghz and its not avaialable to public. Just imagine that along with a 4Gb ram and T658 mali 8 core overclocked to 527hz gpu.Wishfull thinking!

42. dmckay12

Posts: 243; Member since: Feb 25, 2012

I can't imagine that being useful, but that would be awesome. If they put it in a device now, I would buy it tomorrow. For now, the S4 Pro is what we can hope for.

48. remixfa

Posts: 14605; Member since: Dec 19, 2008

Samsung has been demoing A15's in tablets for months. You guys need to catch up. They are production ready. The ONLY thing that might slow it up is LTE integration. Of course, being on a tablet that doesnt matter so much, which is another reason they are going tablet first. And btw, its not just me that understands the tech, its the entire tech review industry that agrees with me. "ther than that GPU which includes support for up to WQXGA (2,560 x 1,600) resolutions -- perfect for the 11.8-inch P10 mentioned in court filings -- and much more, the white paper uncovered by Android Authority also mentions support for features like Wi-Fi Display, high bandwidth LPDDR3 RAM running at up to 800MHz with a bandwidth of 12.8GBps, USB 3.0 and SATA III." http://www.guru3d.com/news/samsung-exynos-5-cortex-a15-dual-chip-uncovered/ "The Exynos 5 Dual is the chip you should look for in upcoming tablets and smartphones, as it should have the most powerful CPU and GPU of any new chips coming out by the end of the year, including the S4 Pro and OMAP 5. Next year, we can begin talking about the quad-core Tegra 4 and the Exynos 5 Quad, but, until then, Exynos 5 Dual should reign supreme in the mobile market in terms of performance and features." http://www.androidauthority.com/samsung-exynos-5-dual-specs-features-106609/ video demohttp://www.cnx-software.com/2012/08/10/arm-demonstrates-mali-t604-gpu-in-samsung-exynos-5-dual-cortex-a15-processor/http://hothardware.com/News/Samsung-Unveils-Exynos-5-Dual-Cortex-A15-based-Mobile-Application-Processor/

52. dmckay12

Posts: 243; Member since: Feb 25, 2012

They are not ready to be sold in devices yet. The S4 pro is already in devices that are coming out soon. It has moved past prototypes and Demos. Read the article. It says that the S4 Pro should be faster running apps designed for multiple cores.

54. MISTER.H

Posts: 167; Member since: Aug 03, 2012

Qualcomm have 4 types of chip, apq. Msm. And another 2, I havnt looked up.

58. remixfa

Posts: 14605; Member since: Dec 19, 2008

oi. devices coming out around Xmas which is the same launch window of the A15 which is "Q4". what about that is so hard? None of the Pro devices are coming out before Q4. Being rumored/announced doesnt mean anything on the timeline. How long was the Bionic announced before it came out ? 9 months? lol. Samsung plays their chips close to the vest since they primarily use them for themselves. They didnt confirm that the S3 was going to be the Quad 4412 until just a week or 2 before it was officially unveiled.. Do you really expect them to tell you what phone the A15 is going to be in months before it happens? Slightly faster in 1 category while being way slower in everything else. If an app opens in 0.3 seconds vs 0.4 seconds, do you really notice? Concentrate on all the features the Exynos 5 has that the Pro doesnt, and how much more powerful the vast majority of the shared features are on the E5. Point is, you guys get your hopes up for impossible time lines. These chips will be dropping in commercial phones relatively at the same time.

41. MISTER.H

Posts: 167; Member since: Aug 03, 2012

I cant wait to get hold of one and root it, and overclock it.

13. crankyd00d

Posts: 191; Member since: Oct 17, 2011

Looks to me like they want to avoid the hassle of acquiring a baseband company as it would be very hard and expensive, and then they would need a couple of years to integrate that into their designs, the future is integrated or die and they know it, I hope they go for it, just as you said they make good chips, and losing competitors is never good

14. SuperAndroidEvo

Posts: 4888; Member since: Apr 15, 2011

remixfa, You normally post factual & true stuff. This time you clearly spoke with emotion instead of fact. It it clear that right now as it stands the Qualcomm Krait S4 is the KING of mobile processors, by a long shot. They are insanely powerful & work with LTE out of the box. They work with ALL LTE's not just the ones in Korea like the quad-core Exynos 4. The Qualcomm Krait S4 Pro dual-core clearly outclasses the Exynos 4 quad-core & is king right now in the benchmarks by such a HUGE margin. Who knows when the Exynos 5 will be in a phone or tablet. All I know is the Qualcomm dual-core S4 Krait Pro is right around the corner & by winter there will be quad-core S4 Krait's that will munch on Exynos 5 A15 dual-cores. Who knows, you maybe having a bad day but you have never been more wrong like you are right now. Hopefully you will get your senses back & see the error of your way. To say Qualcomm chips suck is clearly opinion based & so far off the truth. If you are going to release a "high end" phone right now the S4 Krait Pro is the ONLY way to go.

18. ph00ny

Posts: 2082; Member since: May 26, 2011

Krait isn't the king until the quad core version in pro version gets released. By then they may get overrun by OMAP5 and Exynos5 again

20. SuperAndroidEvo

Posts: 4888; Member since: Apr 15, 2011

Sounds more like hate to me. lol

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