Nvidia Swallows Icera For $367M
We have just heard that Nvidia has swallowed Icera for $367 million dollars. This move gets Nvidia’s foot in the door for baseband and radio chips, leaving some to guess that perhaps Nvidia is thinking of making its own phone. With the Icera acquisition, Nvidia will now be able to combine high-end processors, with cell phone communications.
Nvidia believes that Icera can help it double its revenue from each mobile device. Although all of Icera’s chip sales have been to makers of laptop network cards, the company has started launching smartphone chips earlier this year. Icera’s main customers were Nokia, Huawei, ZTE, and Samsung.
Nvidia stated that the deal would slightly lower operating profit in the first half of 2012, but expects that the graphics company will bounce back in the second half of that year. What can we expect to see once this recession is over? I predict we will see some very powerful companies and many closed businesses. While it can be exciting to see some of our favorite companies grow, it can be equally terrifying to see companies like AT&T accrue more power and use it to raise prices and lower quality. It will be evident how large a role customer loyalty will play into product purchases in the future.