I think the challenge for companies that are out sourcing their manufacturing to contract foundaries is that you might find your unable to meet demand if other contract customers are willing to pay more for existing capacity or if another company is a bigger customer to a specific foundary. I believe AMD saw some of those issues last year.
The cost of building foundaries for the greater densities is so high that only companies with very deep pockets can afford to underwrite such as ventures. The unfortunately part is that it might be stiffling innovation and competition as only the largest companies have enough purchasing power to get concessions out of the contract foundaries.
INTC is on the right track by relying on it own foundaries as it keeps their destiny in their own hands. We have already seen INTC partner with other companies in cases where the risks are high. It seems get a plant up and running with yields to make the plant economic feasible is not as easy as it once was with lower density technologies.
intel also seems to have a big lead in foundry technology which to me means that they may be able to add functionality to their products (as they have done in the past) and take over other business segments.
CEO Paul Otellini announced smartphone deals with Lenovo and Motorola Mobility(MMI_) on Tuesday as the chipmaker tries to move outside its core PC computing business into powering mobile devices. thestreet.com
I remember most analyts thought Intel missed the smart phone market... I bought more at $20...Wasn't Intel opening up Atom last year so people at foundries could use Intel's Atom IP and do their own designs?
Is there any public info how those two (FPGA) customers are doing - they are fairly small aren't they?
I haven't heard anything more about it.
Regarding Intel as a Foundry, I wouldn't expect to see them offer those services except in very isolated cases such as you have mentioned. Intel can get a real premium for it's leading edge process but it's much more competitive with the older processes where the traditional Foundries operate on thinner margins than Intel is used to. In short, the ROI is too low. Additionally, Intel does not have the industry standard infrastructure to support lots of customers who would not have access to Intel's internal tools and methodologies. Having said that, I've been away from the business for a couple of years now so things might have changed.