By Charles King Pund-IT, Inc. August 9, 2017
It’s easier to talk-up destinations than it is the often lengthy, costly and sometimes fraught journeys they require. That shouldn’t be surprising since it’s been the case through much of human history, including vaunted opportunities in various “New Worlds,” the gold rushes of Alaska, Australia, Canada and California, conflicts and wars, and the public sale of commercial goods.
As a result, it’s fascinating when companies take the time and effort to illuminate the progress they’re making toward valuable destinations, along with the steps required to get there. Intel’s completion of its tender offer for MobilEye is a good example. Let’s take a closer look at that.
From car to cloud and back
I wrote about the $15.3B deal when it was made public in March. At the time, Intel noted that MobilEye’s Advanced Driver Assistance Systems (ADAS) and other safety technologies were critical to the purchase decision. Those solutions include the company’s Adaptive Cruise Control (ACC), Lane Keeping Assist (LKA), Lane Centering (LC) and Traffic Jam Assist (TJA) which, as noted by Intel’s CEO Brian Krzanich and Mobileye’s co-founders Amnon Shashua and Ziv Aviram, “Comprise the building blocks of semi/fully autonomous driving.”
The strength of MobilEye’s ADAS and other technologies led the company into successful relationships with all Tier 1 automotive industry suppliers and 27 automotive OEMs, resulting in the company’s solutions being incorporated into 300+ car models globally. That was obviously a key attraction for Intel but just as important are the ways in which MobilEye’s offerings complement its own autonomous vehicle/driving efforts.
The fact is that successfully enabling autonomous vehicles requires a “system of systems” approach that includes and deeply integrates vehicle-based computer vision, driver assistance and safety technologies (like MobileEye’s), onboard processing, memory and storage (for managing the 4TB+ of data individual vehicles are expected to generate daily), robust LTE (and eventually 5G) wireless networks, and high-performance backend data center resources for machine learning, data analysis, vehicle localization and mapping.
If you’re familiar with Intel you’ll note that the company has substantial or market leadership position in virtually all of those areas, with the exception of vision and ADAS technologies. Completing the acquisition of MobilEye thus provides Intel the “eyes” it needs to complement the “brains” of its endpoint, networking and backend solutions, and deliver end-to-end fully/semi-autonomous driving/vehicle solutions for customers.
That’s critical to Intel’s ability to pursue what it estimates will be a $70B vehicle systems, data and services global market opportunity by 2030. But it will also allow Intel to effectively expand its vision for autonomous driving well beyond cars to include trucks and semi-trailer rigs, delivery vans, buses and public transit, farm and industrial equipment and military vehicles.
Completing the deal also ups the stakes significantly for other vendors that intend to compete in the market, including NVIDIA, Qualcomm, AMD and Samsung. Some, notably NVIDIA, have made sizable inroads in self-driving technologies but none can fully match Intel in the proven, widely adopted data center technologies required to support autonomous vehicles.
That situation could certainly change, and the market and competitive landscape will inevitably be different in 2030 than it is today. But by completing its tender offer for MobilEye, Intel has shown that it knows what it takes and is taking the necessary steps to travel to its chosen destination. With MobilEye, Intel has effectively seized the pole position in the race to autonomous vehicles. Other vendors will need to get up to speed quickly or risk becoming roadkill.
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