Nvidia Gives Up on Modem Effort, Offers Icera for Sale

Nvidia Corp., the biggest maker of chips for computer graphics cards, said it will give up trying to make modem chips for mobile devices, abandoning a key element of its attempt to break into the smartphone market.

Nvidia is open to selling its Icera unit, purchased in 2011, and will stop development of its modems, chips that connect phones to cellular networks. The “wind down” of the unit will be completed by the second quarter of fiscal 2016, the Santa Clara, California-based company said Tuesday in a statement.

The company joins a growing list of rivals -- Texas Instruments Inc., Broadcom Corp. and Freescale Semiconductor Ltd. -- that have exited the market dominated by Qualcomm Inc. Even Qualcomm is facing increasing competition as Samsung Electronics Co. uses more of its chips in its phones and lower-priced Chinese makers enter the market.

Nvidia’s Icera unit has about 500 employees located mainly in the U.K. and France. Nvidia, which is no longer chasing the smartphone market, paid $367 million for the company in 2011.

Nvidia said it will focus on gaming, automotive and cloud computing opportunities.

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