LAS VEGAS — Intel’s (INTC) chips have dominated the PC era, but when it comes to post-PC devices such as smartphones and tablets, the company is less than an also-ran.
But at the Consumer Electronics Show here Tuesday, company CEO Paul Otellini insisted that Intel will be an important player in the post-PC era. And he finally could back it up.
Otellini announced deals with Lenovo and Motorola that will put the company’s mobile processors in smartphones for the first time later this year. And he and his colleagues showed off a variety of new computing products to compete with tablets such as Apple’s (AAPL) iPad.
“We’re raising the bar for every device on the market. This is exactly the direction we should be going,” Otellini said in a keynote speech. “We’re excited about helping to create the future of computing.”
Lenovo executive Liu Jun, who joined Otellini on stage, said the company would start shipping its new Intel-based Android smartphone in the second quarter of this year in China. Meanwhile, Motorola Mobility CEO Sanjay Jha announced that the company has signed a multiyear deal with Intel to put its chips in multiple devices, the first of which should hit the market in the second half of this year.
The announcements are potentially big breakthroughs for Intel. The company has been working for years on developing chips for smartphones but had found no takers. Critics have charged that its previous chips were slow battery hogs that weren’t suited for mobile devices.
To date, the smartphone and tablet markets are dominated by chips designed by ARM and manufactured by companies such as Qualcomm and Texas Instruments. Intel has announced partners for its chips in the past, including Nokia and LG, only to have those companies abandon efforts to develop an Intel-based smartphone.
But Otellini argued that such problems are in the past. He and a colleague showed off a prototype for a smartphone using the company’s latest mobile chips that quickly pulled up Web pages and easily played back high-definition video.
Otellini said the mock-up phone, which runs Android, not only outperforms those using chips designed by arch-rival ARM but also offers better battery life. It gets up to eight hours of phone talk time and 14 days of standby time between charges, he said.
“We’ve only just begun applying our technology to smartphones,” he said, belying the years of effort that Intel has put into developing the chips.
Otellini also used his appearance to tout “ultrabooks,” a new ultralight form of laptops using the latest low-power Intel PC processors. He and his colleagues showed off several so-called convertible and hybrid designs in the works that incorporate touch screens that can be folded back so that the laptop resembles a tablet or brought forward so that it resembles a portable media player.
Such devices are expected to take advantage of Microsoft’s new Windows 8 operating system, which has a new interface specifically designed to be used with touch-screen devices. Otellini not-so-subtly made the case that the software and adaptability of ultrabooks make them much more capable devices than the iPad and other tablets that lack keyboards.
With ultrabooks, “we’re bringing an uncompromised experience,” he said.
But consumers will pay for that convenience, at least in the near term. Ultrabooks are generally expected to cost at least 50 percent more than the entry-level iPad and several times as much as low-cost tablets such as Amazon’s Kindle.
Meanwhile, consumer demand for laptops with touch-screen features remains uncertain. Although Intel says its research indicates consumers love the feature, critics have argued that touch screens are a poor fit for such devices.
Earlier in the day, the Consumer Electronics Association, which runs CES, released its annual forecast for U.S. consumer electronics spending. The CEA estimates that spending on tech products in 2012 would top $200 billion for the first time.
Last year, sales of consumer electronics devices reached $195 billion, up 7.9 percent from 2010, Gary Shapiro, CEO of the industry trade group, said in a speech. That growth was far faster than the 3.5 percent the CEA projected at last year’s CES.
This year, the industry expects consumer electronics sales to grow 3.7 percent, Shapiro said.
The consumer electronics industry “remains the economic engine that is growing economies around the world through innovation,” he said.
Tuesday’s forecast for U.S. electronics sales follows the group’s forecast Sunday of global tech sales. The CES and partner GfK expect global tech sales to hit $1 trillion for the first time this year, up 5 percent from last year.
The CES is projecting that electronics sales growth will increasingly come from emerging markets such as China and Brazil rather than from developed ones such as the United States and Western Europe.
Contact Troy Wolverton at 408-840-4285.
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Tech Files columnist Troy Wolverton will be in Las Vegas covering the Consumer Electronics Show. You can keep track of his latest reports on the Mercury News’ website or at Twitter.com/troywolv.
