Original URL: http://www.theregister.co.uk/2006/08/10/eicon_intel_sale/

Intel trims telco fat and sells it to Eicon

'We'll chew on that'

By Ashlee Vance

Posted in Financial News, 10th August 2006 00:25 GMT

Intel continues to carve off its least impressive units. This time around the chipmaker has made a bundle out of its telecommunications business and mailed it to Canada's Eicon Networks.

Neither Eicon nor Intel disclosed financial terms for the deal, which will result in Intel's media and signaling assets ending up at Eicon in the next four to six weeks. The product lines affected include Intel's SS7, PBX integration and gateway products; gear it acquired from Dialogic and any Host Media Processing products. This deal follows Intel's XScale sale to Marvel for $600m.

Eicon is thrilled to get Intel's trimmed fat.

"This is a very exciting day for Eicon," said Nick Jensen, Eicon's CEO. "Eicon's and Intel's media and signaling products complement each other well. We expect this acquisition to extend our global reach with solutions for both traditional circuit switch communication technology and leading-edge IP platforms for both enterprises and service providers."

A "significant number" of Intel's 600 telecommunications biz employees should end up at Eicon, the companies said.

Intel stressed that the deal does not affect its ATCA and CompactPCI blade plans.

Intel's chief Paul Otellini is using the business unit sales to prove that he's serious about lowering costs. The company's financial fortunes have soured due to increased competition from AMD and a number of product miscues.

Given that the sale to Eicon doesn't even count as material, you can figure that losing the telecommunications biz won't do a lot to affect Intel's bottom line. Every little bit counts though, right? ®