Intel Buys Mobileye for $15.3 Billion in a Bid to Lead Self-Driving Computer Systems Market
Intel Buys Mobileye for $15.3 Billion in a Bid to Lead Self-Driving Computer Systems Market and have announced that the autonomous-driving sector will be worth conservatively about $70 billion by 2030.
Intel now join a growing number of tech companies such as Google and Uber in the race to develop the most advanced autonomous driving systems in the world.
Many of these companies as well as the big automotive manufacturers are already testing autonomy on public road throughout the world.
The $15.3 billion deal was announced on Monday by Intel who are positioning themselves to one of the tech market leaders in autonomy which is one of the largest and fast-growing new sectors.
Mobileye is an Israeli company founded in Jerusalem back in 1999 that makes sensors and cameras for driverless vehicles. Mobileye, utilises digital vision technology which helps autonomous vehicles safely navigate city streets.
Mobileye, has collaborated with several automakers, including Audi, for the use of its vision and camera technology, which uses machine learning and complex neuroscience to help cars avoid obstacles on the road.
Google and Uber have already invested billions of dollars in their own technology and they have engaged in partnerships with automakers like Chrysler and Volvo.
Why is Intel entering the autonomous technology sector? Well, it sees huge potential in the future with self driving vehicles. It also see the potential that its computer business could be under threat in the future?
Driverless vehicles are going to require massive computing power, including the latest microchips able to crunch reams of data in seconds to keep the cars safe, so it was always inevitable that tech companies such as Intel entered the autonomous marketplace.
Many of the auto manufacturers lack the in-house expertise with computer technologies and some do not want to rely on the likes of Google so they are reaching out to computer companies such as Intel.
Intel have been in the personal computer market for more than thirty years supplying hundreds of millions of desktop computers with much of their internal architecture and dominating the microchip market.
Brian Krzanich, Intel’s chief executive, told investors:
“Scale is going to win in this market,”
“I don’t believe that every carmaker can invest to do independent development into autonomous cars.”
In recent years, Intel has struggled to keep its market share in the production of microchips as they have been losing out to rivals such as Nvidia and Qualcomm, so it is no wonder they have been seeking to diversify into other markets.
Since last year, Intel has signed partnership deals with BMW and Delphi Automotive, an auto parts supplier, to expand its presence in the autonomous vehicle field.
It also acquired a 15 percent stake in Here, a digital mapping business owned by a consortium of German automakers, and announced last year that it would invest $250 million in start-ups working on driverless car technologies.
The microchip manufacturer plans to bring autonomous cars to city streets by 2021 with the help of their partner BMW and have announced plans to have up to 40 autonomous cars on American and European roads by the end of this year.
Martin Birkner, an automotive analyst at Gartner, a technology research company in Munich said:
“This deal makes Intel a Tier 1 partner for the automotive industry,”
“As the industry moves toward autonomous driving, new types of digital suppliers like Intel are developing quickly.”
Mobileye is creating a system which they have called RoadBlock, an advanced driver assist system that collects imaging and location data used to create a vast digital map of roadways in the United States and Europe.
Mr. Shashua, the founder of Mobileye, who wants to provide carmakers with a complete product line of digital services that go beyond what they can do for themselves said:
“The collaboration that we want to do can’t happen if we are two different organizations,” he said on Monday.
“The collaboration already runs deep.”
Many regulator in the United States, Europe and around the world are concerned about which laws and regulations to introduce in the future to make autonomous driving safe. They are divided on the issue of self-driving cars, causing the automotive industry to complain that the delays could hamper plans to take the technology to the streets.
Experts are expecting more and more deals like Intel’s acquisition of Mobileye are likely to follow as firms jostle for position within the autonomous market sector.