Vodafone and Intel are teaming up to develop and market machine-to-machine (M2M) solutions that will combine Intel's computing processor platforms with Vodafone's network and connectivity services.
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Applications are expected to range from smart meters, connected white goods and connected vehicles to entire "smart" buildings, the companies said in a joint statement.
The news comes a day after Deutsche Telekom and France Telecom announced plans to develop a Europe-wide network for M2M applications.
The move puts Vodafone and Intel into direct competition with Nokia and UK-based chip designer ARM. The European Commission recently decided to fund the conversion of Nokia's Symbian mobile operating system into one suitable for embedded systems. ARM designs currently outsell Intel's, and are already optimised for connection to mobile networks.
The market for M2M systems is expected to be worth billions of pounds as "the internet of things" emerges.
The two firms aim to produce system development kits based on Intel's Atom processor. This will make it easier and quicker to develop M2M systems, to embed them in objects, and connect them to communications networks, the firms said.
"Information that is captured by the connected device and transmitted by the network can then be turned into valuable smart services for the customer," the companies said in a joint statement.