Intel Corporation (INTC)’s Internet TV Novel Feature A Game-Changer?

Intel is pushing its x86-based chips for servers. If servers go with ARM-based chips as a standard, then Intel will be in serious trouble as their core business is rendered a thing of the past with applicability only in what remains of the PC market. AMD is pushing for ARM-based chips in servers but only with microservers, which may or may not become a significant part of the overall server market. If it becomes significant it will take a large chunk of revenue from traditional servers.

ARM will continue to benefit even if AMD fails, though it seems to be at least fairly valued if not overvalued. AMD is facing the same problems as Intel without the benefit of being the dominant company in a flagging market. That actually makes me want AMD over Intel. AMD is at the bottom and has everything to gain. If it loses fine, you can invest change and reap big rewards. Intel has everything to lose, and the share price has a long way to drop while it finds itself.

Internet TV, Really?

Intel will need to work hard to stay relevant into the future, and microservers seem to be a key part of that strategy. Intel is looking for new avenues of growth and relevance in addition to its rearguard action in processors. Hence, its foray into Internet TV.

The concept is not the problem, though it is well outside Intel’s comfort zone. I don’t care what chips they stick in the box, it is not a natural evolution of Intel’s business. Random forays into the “it” business does not always work out well. I always hold up the Cisco camcorders as an example. Consumer products were hot, so it probably seemed like a good idea. Streaming is so in right now. Companies fall into fads like high school kids, and just like those kids they sometimes pay top dollar.

Content will be the hardest part. It is not just about having TV shows available 7 days. There will be a streaming service. While these services are fighting it out, the content providers are enjoying the fruits of their outdated model. A reckoning is coming for them, but that is a different article. There is a reason streaming is not the revolution it is supposed to be, despite all the pieces being there. Content providers have no incentive to make their content available.

The same technology that makes streaming possible makes it easy for content providers to set up their own streaming services. It is too early to tell if Intel has really cracked it. A quick Internet search yields some really strange positive energy. I am still scratching my head trying to understand the situation. I will avoid Intel based upon its heavy dependence on the PC market.

The article Intel’s Internet TV Novel Feature A Game-Changer? originally appeared on Fool.com and is written by Nihar Patel.

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