iPhone and the Future of Marvell

“Apple plans to sell its iPhone through an exclusive marketing agreement with AT&T’s Cingular Wireless unit. While Cingular’s data network is woefully slow, the Wi-Fi feature will give the mobile phone high speed data capability when users can find Wi-Fi hotspots. To date, cell phone service providers have been reluctant to introduce mobile phones with Wi-Fi capability, fearing the wireless technology — which is often free — could cannibalize their existing data network service offerings.” (EE Times)

Marvell scored the design win to provide the Wi-Fi chip for the iPhone, and if the product and the functionality takes off, could have a nice upswing.

Last year, Marvell bought Intel’s Communication chip business for $600 Million. It was a risky move, since the division has consistently struggled to take off within Intel. Will the iPhone win allow the company to recover its investment?