Intel’s server monopoly would be strengthened if talks to buy Altera succeed.
Reported by the Wall Street journal on Friday, Intel is alleged to be currently in discussions with fellow-chipmaker Altera, which could fortify the monopoly that the U.S firm holds in the server market. Intel currently have 98% market share of the server industry. The deal is said to be worth in excess of $10 billion.
Intel shares were on an upward trend from November 2012 unitl November 2014 when investors understood that the traditional PC business at Intel was losing ground. In fact only two weeks ago, Intel lowered fourth quarter revenue forecasts due to poor demand on its PCs. However, the server business reported last quarter revenue up by 18% year on year, delivering $14.4 billion out of the total $55.9 billion 2014 revenue.
The move on Altera is a move in the right direction as far as investors are concerned.
Altera Corporation invented the world's first reprogrammable logic device in 1984. Today, more than 3,000 employees in 19 countries provide ingenious custom logic solutions which include FPGAs, SoCs, CPLDs and power management products. Altera’s market cap stood at $13.36 billion when markets closed on Friday.
It is the FPGAs (Field Programmable Gate Array) that Intel need as they are faster than Intel’s processing chips, hence companies such as Microsoft and Baidu using Altera’s and Intel’s chip in conjunction, with excellent results.
MT4 chart: Intel
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