Intel retracts from TV market

Digital Home Group, and will no longer make chips for interactive TV set-top boxes like the Google TV devices from Sony and Logitech, San Francisco Chronicle reports.

The engineers from the group are being merged into Intel's tablet group. Intel confirmed the move, explaining: "There is a ton of synergy between tablets and TVs, so we will combine the remaining CE businesses with the tablet organisation.”

According to ZDNet, the chip company put its weight behind smart TVs in September 2010, when CEO Paul Otellini demonstrated a Google TV mixing up IM, Facebook and Web browsing on top of a live TV transmission.

The company promised a "completely different TV viewing experience, enabling consumers to interact with their TV like never before, seamlessly integrating a broad array of Internet content, broadcast programming, personal content, and virtually unlimited applications”.

Given Google's success with Android, and the boom in the smartphone and tablet sectors, the smart TV market was a sector that Otellini focused on as a potentially lucrative expansion of Intel's chip business, The Inquirer notes.

The major TV makers were not enamoured by Intel's chips. Top TV makers like Samsung and Panasonic have their own chips, which means Intel was always going to have a relatively small choice of potential customers for its TV chips.