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Intel buys Mobileye
Road to autonomy takes a turn with $20b Intel-Mobileye buyout
14 Mar 2017
COMPUTING giant Intel has gained a significant advantage in the race to offer advanced self-driving vehicles, with a $US15.3b deal ($A20b) to acquire Israeli autonomous tech specialist Mobileye.
The agreement is due to be closed by the end of the calendar year and will add Mobileye’s range of driverless technology including cameras and sensor hardware as well as the processors and the software to run them, to Intel’s existing autonomous ventures.
For the deal, Mobileye’s shares have been valued at $63.54 ($A84.23) each for a total enterprise value of $14.7b ($A19.5b) – a significant sum, but the new owner is justifying its investment with a prediction that market opportunity in vehicle data systems will top $70b ($A92b) by 2030.
In a statement to Intel employees, CEO Brian Krzanich explained the importance of a major computing powerhouse in the development of autonomous cars and the supporting network of technology.
According to Mr Krzanich, “Data is the new oil” and the car enthusiast’s most frequently asked question “what’s under the hood” will “increasingly refer to computing, not horsepower,” he said.
“At four terabytes of data per day, the average autonomous car will put out the data equivalent of approximately 3000 people. Put just one million autonomous vehicles on the road and you have the data equivalent of half the world’s population.
“This massive amount of data requires all of Intel’s assets to provide the cost-effective high-performance solutions our customers need.”“I believe that today’s announcement puts us in the driver’s seat to achieve our vision of creating the technology foundation on which the future of autonomous driving will be built.”
The new Automated Driving Group will be headquartered at Mobileye’s centre in Israel and lead by existing chairman Amnon Shashua and with the two company’s combined momentum going head to head with other tech firms in the autonomous race including Qualcomm and Nvidia.
From a vehicle brand perspective, the new deal has the potential to change the relationships of some car-makers and respective technology firms, as the various companies consider partnerships.
Among a number of automotive companies, Volkswagen Group and BMW Group are already working with Mobileye to develop autonomous vehicles, which could put pressure on rival tech firm Nvidia, with which VW Group brand Audi is also partnered.
Another obvious rival to the freshly formed Intel branch includes Qualcomm Technologies, which has already formed ties with Daimler and Renault and secured a deal to acquire automotive electronics manufacturer NXP.
Mobileye co-founder, president and CEO Ziv Aviram said that with the added momentum of Mobileye, Intel will be more attractive to car-makers that are looking to accelerate the development of driverless technologies.
“By pooling together our infrastructure and resources, we can enhance and accelerate our combined know-how in the areas of mapping, virtual driving, simulators, development tool chains, hardware, data centres and high-performance computing platforms,” he said. “Together, we will provide an attractive value proposition for the automotive industry.”
Until the transaction is finalised at the end of the year, both companies will continue operating in an unchanged capacity.
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