INTC Intel Corporation

By Georgia Wells 

LAS VEGAS -- Qualcomm Inc. views its latest smartphone chip as a "connected device" chip, a bid to outdistance rivals such as Intel Corp. in the burgeoning market for gadgets and equipment with computing and communications capabilities built in.

The computer-chip maker based in San Diego unveiled its latest premium chip, Snapdragon 835, on Tuesday at CES 2017, a consumer-electronics show in Las Vegas.

Like previous Snapdragons, the new model includes upgraded technology expected to improve the performance of coming smartphones incrementally and drive consumers to upgrade their handsets. But the chip also includes features designed to process images and sound for augmented reality and virtual reality, and its improved battery life and smaller size might suit it for small, internet-connected devices.

The new chip's potential in devices other than smartphones is important to Qualcomm, because Qualcomm's reliance on the phone market leaves it exposed to the slowing growth of smartphone shipments. Qualcomm is one of the largest suppliers of chips that enable phones to communicate with cell networks.

Qualcomm has moved in recent years to diversify its business to markets similar to those that already use its chips, such as connected devices.

Intel, whose chips provide computing power in most computers, also unveiled Tuesday its latest processors designed for computers, virtual reality and videogaming. The processor boosts performance of videogaming laptops by as much as 20%, according to Intel, and makes it easier to stream 4K video without additional, specialized hardware. The processor is a part of the 7th Gen Intel Core processor family that Intel announced in August, code-named Kaby Lake.

Qualcomm beat rivals to market with chips bearing transistors that measure 10 nanometers, the smallest produced commercially by any chip maker. Qualcomm unveiled in December a chip for servers that, like the new Snapdragon, has 10-nanometer transistors. Intel expects to bring to market its own chips with 10-nanometer features this year.

The minuscule transistors on Qualcomm's new chip are smaller than those of its previous model, the Snapdragon 820. The new chip uses 25% less power than the previous model, according to Qualcomm. The smaller transistors also make for a smaller chip: It is now a bit smaller than a penny, while the previous model was about the size of a penny.

Companies planning to use the new chip include augmented- and virtual-reality developer Osterhout Design Group in San Francisco. ODG said Tuesday that its latest smart glasses will use the Snapdragon 835. A spokesman for Qualcomm also said a new voice-assistant home appliance is expected to use the new chip.

Artificial- and virtual-reality headset makers aim to make their gadgets smaller and more power-efficient, which might make the new chips attractive in those devices.

The new Snapdragon also processes virtual-reality content in a new way that allows the wearer to experience depth; now when the user walks toward an object in virtual reality, the object gets bigger.

For security, the new chip also will be able to process voice and eye data so users can unlock devices through the sound of their voices or images of their eyes.

Write to Georgia Wells at Georgia.Wells@wsj.com

(END) Dow Jones Newswires

January 03, 2017 17:14 ET (22:14 GMT)

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