Hewlett-Packard Line Weighs Intel, Texas Instruments to Supply Chips
May 10, 2002 (The Dallas Morning News - Knight Ridder/Tribune Business News via
COMTEX) -- Texas Instruments Inc. is scuffling with Intel Corp. over which
company will supply chips for post-merger Hewlett-Packard Co.'s wireless
handheld computers.
H-P intended to use the TI system in its planned Jornada 920 handheld, the first
Jornada to also function as a cellphone.
But after closing its acquisition of Compaq Computer Corp., H-P said Tuesday
that it plans to phase out the Jornada line this year and replace it with
Compaq's iPaq device, using some of Jornada's technology.
Now H-P has to decide whether to sell the Jornada 920 at all and whether to use
TI chips in future wireless handhelds.
"We should know better within the next couple of weeks whether or not the
product will go to market," H-P spokeswoman Sherry Brit said. "I'm not quite
sure whether or not our new H-P iPaqs will be using TI chips."
Computer companies such as Compaq and H-P have traditionally used Intel's chips
in handheld computers.
But when handheld makers started incorporating cellphones into their computers
last year, some switched to TI's chip system because it was designed for voice
and high-speed data transmission.
Intel is making its own push into the wireless handheld market. Compaq said last
year that its upcoming wireless devices would support Intel's technical
standards.
But some analysts think TI has a better chance of winning a place in a wireless
iPaq.
"TI has made enough major manufacturers happy with their product to at least
allow them a foot in the door," said Marc Zabicki of H&R Block Financial
Advisors. "Intel's name alone is going to allow them some recognition, but
whether it can unseat TI remains to be seen."
TI's experience in the wireless world may give it an advantage over Intel, which
is relatively new to the industry, said Frost Securities analyst Cody Acree. H-P
hasn't been in the wireless industry long either, and Mr. Acree says the company
may want a partner with a more extensive history. "The tendency is always going
to be to lean on the competency of the vendor," he said. "TI offers the most
support."
By Crayton Harrison
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