Intel to make chips for Altera

Intel has agreed to make chips on behalf of Altera, a significant step towards opening its prized manufacturing technology to customers on a larger scale, potentially including Apple.

Sharing its manufacturing plants to strategic customers could help the world’s top chipmaker offset the growing costs of developing new technology and help keep the plants running near capacity as Intel’s traditional PC business loses steam.

Intel will make Altera’s programmable chips using its upcoming 14 nanometer trigate transistor technology, the most notable agreement of its kind announced so far by the chipmaker.

“It’s a step in terms of building into a business level we wish to achieve,” Sunit Rikhi, vice-president and general manager of Intel custom foundry, told Reuters. “There’s no doubt in my mind the foundry will be a significant player in the future.”

Building new generations of chip manufacturing plants is becoming more and more expensive, and Intel has said in the past it was willing to open its facilities to carefully selected customers.

Intel has announced agreements to manufacture on behalf of Achronix Semiconductor and other small chipmakers but the announcement with Altera, one of two leading programmable chipmakers, is potentially much larger.

Some investors believe Intel may eventually agree to make Apple’s processors for the iPhone and iPad.

“If and when we are called upon to serve large mobile customers who can drive a lot more volume, we could serve them today in terms of capability,” Rikhi said.

“I’m confident we have a very strong platform of offering upon which we can scale.”

Reuters