Intel Corporation (NASDAQ:INTC)’S Mobileye NV (NYSE:MBLY) Purchase May Really Be About Thwarting NVIDIA Corporation (NASDAQ:NVDA)’S Car To Cloud, Data Center Connection

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Autonomous vehicles mainly depend on the compute at the data center. The move by Intel Corporation (NASDAQ:INTC) to acquire Mobileye NV (NYSE:MBLY) may be interpreted as a way of trying to control its own destiny for the data centers.

According to Intel CEO Brian Krzanich the cars will require a lot of connectivity, larger amounts of data center and cloud computing as the company plans to increase its mapping requirements. Krzanich said this after Intel announced a $15.3 billion deal to acquire Mobileye.

The subject of the autonomous vehicles carrying their own data centers come up several times in all Intel’s talks about autonomous vehicles. According to Intel, cars and Mobileye’s computer vision technologies are the real Internet of Things play. Data computing will be have to on the cloud where Intel is a well known brand the same way it was with the PCs.

While the idea of acquiring Mobileye makes a lot of sense, Intel’s acquisition was very defensive and seen as an offensive move. The concern is that Intel’s competitors like QUALCOMM, Inc. (NASDAQ:QCOM) and NVIDIA Corporation (NASDAQ:NVDA) can use ARM-based processors in their automobiles in addition to edge devices and work their way back to the data center and cloud market.Nvidia is already a major player in the market as its GPUs have made successful inroads in the high performance and data centers. Qualcomm on the other hand purchased NXP for its auto industry in addition to outlining ARM servers with Microsoft Corporation (NASDAQ:MSFT)

Krzanich seem to be right when he says the move from automobile to city, home, cloud, and data center will be in sequence. It however remains unclear how the spoils will be split.

Analysts have however found Intel’s move to purchase Mobileye as being so defensive. The purchase follows a recent acquisition of Nervana, Altera and Movidius and an approximated cost of $16.2 billion. The company also announced plans to increase capex for memory. Intel’s revenue decreased by 8% from the recent mid-teens which may be due to stiff competition from Nvidia’s parallel computing platform.

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