Intel-Powered Dual OS Windows 10/Android Smartphone Is Coming Soon

Summary

The $299 Elephone Voyney is only waiting for Microsoft to release the final version of Windows 10 Mobile OS.

The Elephone Voyney has a quad-core Intel processor that lets it dual-boot Windows 10 Mobile and Android operating systems.

Intel is reducing its contra revenue discounts on Atom tablet application processors.

I wrote about Elephone's dual-OS smartphone last May. I said it was going to have an Intel (NASDAQ:INTC) processor. WM Power User supported this assertion two weeks ago. The upcoming $299 Elephone Voyney will allegedly have a quad-core Intel processor, 3GB of RAM, 20.7 Sony (NYSE:SNE) Exmor IMX230 camera sensor, and a 2K (2560x1440 resolution) 5.5-inch screen display.

I will repeat it again - only an x86 processor could take full advantage of Windows 10's Continuum for Phones feature. No Snapdragon or MediaTek processor will be able to match the Intel x86 chip when it comes to universal compatibility with Windows legacy software.

(Source: gizchina.com)

I suspect Elephone is now only waiting for Microsoft (NASDAQ:MSFT) to release the final version of Windows 10 Mobile so it could do the commercial launch of the Voyney in China. As of now, it's likely Microsoft's tardiness is delaying the launch of the Intel-powered dual-OS handset from Elephone.

September is almost over but Microsoft is still beta-testing Windows 10 Mobile.

Why It Matters

Elephone's wise decision to trust the Intel x86 architecture will definitely inspire other Chinese OEMs to follow its example. White-box tablet manufacturers are already selling dual-OS Windows/Android tablets with calling feature since last year.

Intel is now cancelling its discounts on Bay Trail Atom tablet application processors. Chinese OEMs might find it prudent to shift toward making dual-OS smartphones/phablets to be able to sell their products at a higher retail prices. As per Digitimes' supply chain informers, Intel will stop giving an $8 discount on $12/each Bay Trail processors.

Intel is now only willing to offer a $2-$3 discount on $15 Cherry Trail Atom tablet application processors. The official U.S. price tag of the cheapest Cherry Trail Atom x5- xZ8300 is $20/tray, but even if Intel sells it for $12 in China, the very low margins on Android tablets and phones will force Chinese OEMs to differentiate their products with a dual-OS feature to make it more attractive than the competition.

It's unclear if Intel also is stopping the $8 discount on Bay Trail Atom chips for Android smartphones. If not, then Elephone and hundreds of Chinese OEMs will shift more of their production toward Intel-powered large-sized smartphones.

There is really no need for 7-inch tablets when there are 6.3-inch phablets. The $8 discount on Bay Trail Atoms for phones is a nice incentive for Elephone and others to simply reclassify their calling-enabled tablets to the smartphone category.

With or without the discount from Intel, the Windows 10 Mobile OS is now free from Microsoft. Unlike Google (NASDAQ:GOOG) (NASDAQ:GOOGL), Microsoft is now an enthusiastic supporter and it also offers subsidies for dual-OS devices.

My Takeaway

Making dual-boot Windows 10/Android handsets and selling them $20 or $25 higher than their equivalent Android-only phones is a win-win deal for Chinese OEMs like Elephone. Intel's decision to cancel/reduce its subsidy on tablet application processors also is one more reason for all of us to remain long on INTC.

It's high time that Intel lets Microsoft do most of the contra revenue on Intel-powered dual-OS phones and tablets. That company has far more cash reserves than Intel has now. A significant reduction on subsidy for mobile application processors might make more investors fall in love again with INTC.

If not for the huge operating losses on mobile chips, Intel would have delivered better net income and gross revenue for the last three years.

(click to enlarge)

(Source)

I again reiterate my position that INTC is a buy for long-term value/DCF-minded investors. As per the chart above from Simply Wall Street, Intel remains a highly profitable company with an almost-monopolistic wide moat on server/desktop PC processors.

X-Fin's 10-year projection for the intrinsic value of INTC also is very positive in spite of me only using a mere 1% initial revenue growth rate.

(click to enlarge)

(Source: X-Fin.com)

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Source: Intel-Powered Dual OS Windows 10/Android Smartphone Is Coming Soon