‘Wintel’ team pushing own paths into mobile - MarketWatch

By Dan Gallagher, MarketWatch

SAN FRANCISCO (MarketWatch) — The two companies that together ruled the PC market for more than two decades outlined their differing plans Tuesday for the mobile market — an area in which both have fallen behind their competitors.

Microsoft CEO Steve Ballmer, left, and Intel CEO Paul Otellini are leading their respective companies through a rapidly changing market for mobile computing devices.

At a developers forum in Southern California, Microsoft Corp.MSFT +0.58% took the wraps off Windows 8, its next operating system that is designed to work across the spectrum of devices from PCs and laptops to tablets.

In San Francisco at its own developer’s forum, Intel Corp. INTC +2.37% outlined its own plans for the mobile market, which include a partnership with Web search giant Google Inc.GOOG -0.11% to develop chips operable on the Android mobile platform — which has become a key rival to Microsoft’s Windows in the fast-growing mobile market.

“Computing is in a constant state of evolution,” Intel CEO Paul Otellini said at the company’s gathering.

The partnership with Google is designed to boost the market potential for Intel’s Atom chip, which was popular in the short-lived netbook category but has thus far not gained much share in the mobile category. At the IDF gathering, Google’s senior vice president of mobile, Andy Rubin, joined Otellini on the stage. Rubin said Google planned to “optimize” future versions of Android for the Atom chip family.

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Intel is finding itself competing more closely with rivals such as NvidiaNVDA +2.25% , Texas InstrumentsTXN +1.41% and QualcommQCOM +1.81% in the mobile market.

“We believe this partnership will enable Intel to participate officially in the Android device ecosystem,” wrote Nomura analyst Romit Shah in a note to clients.

Unclear is where this leaves MeeGo, the mobile operating system that Intel was developing in partnership with NokiaNOK 0.00% and other companies. The platform took a hit when Nokia decided to throw its smartphone efforts behind Windows Phone earlier this year.

A spokesman for Intel said Tuesday that the company “remains committed” to MeeGo and is continuing to develop the platform.

And the lines between the categories are blurring. For example, Microsoft and Qualcomm announced on Tuesday that the two companies are collaborating to develop Qualcomm’s Snapdragon processor family for the first generation of Windows 8 PCs. The Snapdragon already powers several of the Windows Phone devices on the market from companies such as Samsung and HTC.

For Microsoft, the company spent time on Tuesday with developers showcasing the capabilities of Windows 8, in the hopes of energizing support for the operating system ahead of its launch, which is expected sometime next year.

Independent technology analyst Roger Kay noted that Tuesday’s developments do not change the long-standing relationship the two companies have in the PC business.

“The core relationship is still intact. People forget that this is a big volume business that they make a ton of money on,” Kay said of the PC market. He characterized the new developments in mobile “as more of an open marriage right now.”