TAIPEI -- Intel, the world's leading maker of microprocessors, will team with leading Taiwanese mobile chip developer MediaTek in an area where the U.S. company has suffered setbacks: 5G.
HP and Dell, the two biggest American computer makers, will be the first to use such chip solutions, MediaTek and Intel said Monday.
5G-capable laptops are expected to debut in the next year or two, and some see them as a potential fresh catalyst for growth in the declining PC market.
"Our 5G modem for PCs, developed in partnership with Intel, is integral to making 5G accessible and available across home and mobile platforms," MediaTek President Joe Chen said on Monday. MediaTek ranks as the world's second-largest mobile chip developer, trailing only American rival Qualcomm.
Intel dominated the market for PC central processing units for decades, but the biggest U.S. semiconductor company is battling its own manufacturing constraints and losing market share to smaller rival Advanced Micro Devices.
Intel even issued an open letter of apology last week, acknowledging that production shortages dating to late 2018 have yet to be solved. A key customer, PC maker Asustek Computer, said it expects Intel's CPU chip shortage to last at least into the first half of 2020.
The worldwide PC market looks to slump 1.5% in 2019, market research agency Gartner said.
Intel also suffered a setback in 5G modem development and sold its mobile modem unit to Apple for $1 billion in July.
The semiconductor company's previous partnership to share its own 5G modem with China's state-backed mobile chip designer UNISOC Communications also ended at the beginning of 2019 amid U.S.-China trade tensions, the Nikkei Asian Review first reported.
Modems determine data transfer speeds and represent vital components in developing fifth-generation wireless communications, which could enable high-quality video broadcasting, augmented and virtual reality features as well as complicated artificial intelligence applications.
MediaTek, Qualcomm and HiSilicon Technologies -- the chip unit of China's Huawei Technologies -- are the only companies now capable of developing 5G modems. UNISOC, a unit of Chinese state-backed Tsinghua Unigroup, has said it will make 5G chips by the second half of 2020. Apple hopes to develop its own 5G chipsets after acquiring Intel's team.
Worldwide production of 5G phones should reach 260 million in 2020, the Market Intelligence & Consulting Institute in Taiwan estimates, while more notebook computers offer 5G connectivity.
MediaTek adopted an aggressive timetable for 5G development. The chip designer accelerated the schedule for its first 5G integrated chipset to the end of 2019 and expects smartphones equipped with such chips to launch as soon as the first quarter of 2020, a time frame similar to that of Qualcomm.
The Taiwanese company also has benefited from Chinese entities working to reduce dependence on American suppliers and increase orders at alternatives outside the U.S. since Washington's crackdown on Huawei began this year.
MediaTek is a newcomer to serving the laptop market, though it counts major smartphone makers such as Samsung Electronics, Huawei, Oppo, Vivo and Xiaomi as clients.
Qualcomm announced in mid-2019 that it would partner with Lenovo Group to develop the world's first 5G personal computer, while consumers could see such products in the market by 2020, the company said.