Intel finally ups the ante in mobile

February 28, 2012: 9:23 AM ET

Intel's mobile processor is finally getting some love from mobile phone manufacturers.

FORTUNE -- After years of trial and error, Intel's (INTC) Atom processor is finally getting some love from mobile phone manufactures. But that doesn't mean they'll be a hit with consumers. To win over the smartphone-wielding masses, the company will need to get everyday buyers to believe that phones with Intel inside are somehow superior to phones that run on chips made by Qualcomm (QCOM), Nvidia (NVDA) and other competitors.

On Monday, Santa Clara, Calif.-based Intel unveiled partnerships with ZTE, Orange and Lava International (yes, that's a real name of a real manufacturer) to develop phones running on its chips. The announcement was made at a press conference at Mobile World Congress in Barcelona. This comes on the heels of January's Consumer Electronics Show, where Intel talked up device relationships with Motorola Mobility and Lenovo. While it's not clear exactly when and where these phones will launch, it's safe to say at least a handful of Intel-powered smartphones will be available by end of 2012.

MORE: Intel's (latest) mobile comeback

The world's largest chipmaker has been trying to crack the phone market for years. In the meantime, global demand for PCs -- its bread and butter -- has slowed, in large part because of the popularity of smartphones and tablets.

At this week's Mobile World Congress, Intel laid out its mobile strategy. In addition to partnerships with phone manufacturers, the company unveiled several new mobile chips and said its Atom processor will outpace Moore's Law, which states that the number of transistors incorporated in a chip will double every 24 months.

But while Intel's manufacturing and technological prowess is undeniable, most consumers don't know or care which processor is powering their smartphone. At least not yet. Changing that mindset could help boost Intel's presence in mobile. The company has more brand power and marketing dollars than any of its competitors, and could use its "Intel Inside" campaign to get consumers to equate smartphones that run on its chips with superior performance, just like it did in the PC industry.

MORE: Nvidia throws down

That, in turn, could end up getting more manufacturers to commit to developing more Atom-based phones -- including some for the U.S. market, which seems to be a big hole in Intel's announcements to date. Intel's competitors rule smartphones. Qualcomm alone has a 51% market share. But, as a group, they are relative unknowns as household brands.

Intel has already shown it is serious about getting into mobile. But it can't be easy persuading tier-one phone manufacturers to switch to Intel when chips based on the competing ARM architecture work just fine. Convincing consumers won't be easy either, even for the most powerful chipmaker in the world.

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About This Author
Michal Lev-Ram
Michal Lev-Ram
Writer, Fortune

Based in Silicon Valley, Michal Lev-Ram covers enterprise and mobile technologies for FORTUNE. Prior to joining FORTUNE, she wrote for CNNMoney, Fast Company, Popular Science and other business and technology publications. She was also a staff writer at Business 2.0 and holds a B.A. in journalism from San Francisco State University.

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