Giant electronic chipmaker Intel's second big acquisition in two weeks could help move it beyond the struggling personal computer sector by expanding into the fast-growing market for smart phones and other mobile gadgets.

Intel has tried with limited success to get its chips into cell phones, while dominating the PC world. In acquiring German-based Infineon Technologies' wireless communications unit late Sunday for $1.4 billion in cash, Intel gains a portfolio of products covering a full range of wireless options, as well as access to the wireless chip company's customers, including Apple Inc.

"For Intel, this is basically them going all in on wireless," said Jon Erensen, Gartner research director. He added that even with the assets Intel is getting from Infineon, the company still will have to invest "quite a bit" in the business.

What impact this might have on Intel's operations in Utah remains to be seen. Intel is owner along with Micron Corp. of the IM Flash Technologies plant at Lehi , where they produce flash memory chips for cameras and other devices. Asked about whether the Infineon deal or Intel's wireless initiative could affect IM Flash, an Intel spokeswoman would say only "it is premature to speculate" on the affect on the company's fabrication units before the deal closes.

Intel's chips have been criticized as being too power-hungry for today's smart phones. The Infineon deal would give Intel technical know-how to make chips for small devices that don't drain batteries as quickly. That expertise is particularly needed for chips built around the low-power ARM architecture, which is widely used in cell phones.

In announcing the Infineon deal late Sunday, Intel CEO Paul Otellini said the company is "committed to positioning Intel to take advantage of that growth potential in every computing segment, from laptops to handhelds and beyond."

The deal, which still requires regulatory approval, is expected to close in the first quarter of 2011.

On Aug. 19, Intel announced plans to buy security software maker McAfee Inc. for $7.68 billion in what would be the biggest acquisition in Intel's 42-year history once it gains the expected approvals. As mobile phones become increasingly enticing targets for hackers, security companies have been developing ways to protect those devices. With McAfee, Intel would be able to bake security into its mobile chips — including those from Infineon.

Both deals signal a shift away from Intel's traditional market of providing chips to power personal computers. The long-term outlook for the PC market is a little clouded again after a robust comeback led by businesses making computer purchases they had resisted during the recession.

Although Intel's x86 chips are used as the brains in 80 percent of personal computers, the vast majority of smart phones rely on chips based on a design licensed from ARM Holdings, a British company. That's largely because Intel's chips are less energy-efficient and more likely to shorten the battery life of smart phones than those using the ARM design.

Consequently, Intel recently has developed a microprocessor dubbed Atom, which uses less power than its other chips. Still, experts say it may take several years before Intel reduces the power consumption of Atom sufficiently to make it a serious competitor to the ARM chips.

"I think they've realized getting into the smart phone market is going to be more difficult than they had thought," said Linley Gwennap, a chip analyst with The Linley Group. "You can't walk into the phone market today and just offer somebody a processor. You need to offer them a complete smart-phone design."

That appears to be precisely what Intel has concluded, given its recent blockbuster announcements.

Smart phones rely on two main chips — an application processor, which oversees the phone's basic functions, and a baseband processor, which lets the phone communicate with other gadgets. Because Infineon makes a baseband processor and Intel's Atom is an application processor, Intel would own both components that smart phone makers need.

Moreover, by owning Infineon's technology — instead of just licensing it — Intel could more easily manipulate it to work more effectively with its Atom processor, experts said. —

Intel's big step

The deal • Intel Corp. is buying the wireless communications unit of Germany's Infineon Technologies AG for $1.4 billion in cash.

What unit provides • Intel gets a piece of the growing smart-phone market. The unit now makes chips for Apple's iPhone.

Double play • Less than two weeks earlier, Intel announced plans to buy security software maker McAfee Inc. With McAfee, Intel would be able to bake security into its mobile chips — including those from Infineon.

In Utah • Intel owns the IM Flash Technologies plant at Lehi with Micron Corp. Asked about the deal's possible impact here, an Intel spokeswoman would say only, "It is premature to speculate."