Intel sent the technology world into a tailspin after announcing an investment of $60 million into a Chinese drone making company. Intel has expressed interest in growing its business beyond traditional PC processors and taking on more complex projects. In its latest move, the company is not only changing gears into new technology but also crossing borders into communist Chinese territory.
Intel’s venture capital arm announced the investment of $60 million in Yuneec, a Chinese drone making company. The company has operations in Hongkong and Shanghai.
In a video posted on Yuneec’s website, Intel chief executive Brian Krzanich confirmed the shift from traditional PC processor unit making. He said, "We've got drones on our road map that are going to truly change the world and revolutionise the drone industry.”
The executive further added, "At Intel we believe in a smart and connected world. And one of the best ways to bring that smart and connected world to everyone and everywhere has been drones."
Interestingly, this isn’t the first investment for Intel in the drone market. The company has been on an investment spree with regard to the drone industry, having previously announced investments in American drone companies Airware and PrecisionHawk.
Yuneec was founded in 1999 in Hong Kong. It specializes in drones for aerial photography and is also a maker of the technology for electric powered planes. One of its more popular models, the Typhoon Q500, retails in the U.S. for $1,299. It can record images at 4K quality and slow motion videos at 1080p resolutions, 120 frames a second.
Chinese companies have crafted an edge for themselves and now dominate the drone market. This domination is attracting American investors keen to capitalize on the emerging market.
Chinese based DJI, based in Shenzhen, just opposite Hong Kong, is the market leader in civilian drone technology, owning over 70 per cent of the market, according to Frost and Sullivan. In May this year, the company got $75 million from Silicon Valley’s very own Accel Partners, raising their valuation to $8 billion.
The news from Intel comes as other tech companies have announced plans to join the drone industry. This week, Sony revealed a prototype drone it will release to the market by 2016. Amazon is set to launch a Prime Air drone delivery system in the next few years while Facebook announced its revolutionary Aquilla project that will see an unmanned aircraft similar in size to a commercial airliner, providing the internet to previously unconnected countries in the world from over 90,000 feet above.
Drones are fast becoming a major everyday part of this century. Through investment in these flying objects, the drone making companies hope to earn revenue from what will be a billion dollar industry in the coming years. For Intel the hope is that these will replace or at least compliment its once dominant chip business.