Intel has entered into an agreement to purchase Lantiq the German network chipmaker for an amount that was not disclosed. Intel is seeking to expand its range of different chips used in gadgets that are Internet-connected, said the two companies on Monday.
The former unit at Infineon was purchased in 2009 by Golden Gate Capital a private equity company for 250 million euros or $280 million. Amongst the companies that invested through Golden Gate in Lantiq was Deutsche Telekom.
Adding connections to Internet to devices ranging from industrial and household machines to soccer balls, a trend give the name Internet of Things has become a new area of competition for Intel and Qualcomm amongst other technology businesses.
One online research firm said that the amount of wireless gadgets will double before the end of this decade, with the majority of growth coming from different smart devices other than smartphones and PCs.
Lantiq produces chips as well for fiber, copper and copper-fiber hybrid connections along with Wi-Fi and mobile broadband, which it then sells to telecom carriers and broadband access providers.
Tech firms are placing their bets on homes that are Internet device connected for future revenue streams and profit. Last year South Korea based Samsung paid more than $200 million for SmartThings a start-up based in the U.S., which makes software that is helpful in controlling everything from light switches to door locks in homes.
In addition, during 2014, Google purchased Nest Labs the smart smoke alarm and thermostat-maker for $3.2 billion.
Intel, based in California, is known best for its microprocessor chips, which perform calculations in server systems and PCs.
However, the company has become very involved in many areas including chips to be used in devices known as gateways that aid consumers in connecting to the net over cable networks.
Lantiq, which is Munich-based offers software and chips used for broadband communications within devices that are supplied by providers of telecommunications.
Its specialty is networking technologies, which included digital subscriber lines or DSL, Ethernet and Wi-Fi.