Intel and Nokia's Mobile Dream: 3-D Graphics in Smartphones

Remember the scene in the first Star Wars movie when Luke Skywalker stumbled across Princess Leia's holographic message to Obi-Wan Kenobi asking for his help? That's just one of the areas for research that Intel (INTC) and Nokia (NOK) want to pursue through a joint effort announced Monday.

The chip giant is setting up a lab at the Center for Internet Excellence at the University of Oulu in Finland to explore 3-D technologies, which already are popular in games and are showing up more in movies. Intel and Nokia believe that consumers will want similar vivid imaging and interactive experiences while using their handsets, which are becoming powerful little computers that do much more than just making phone calls.

Research Complements New Partnership

The research efforts will aim to take advantage of consumers' increasing penchant to connect and interact with each other through social networking and other media sites online, particularly by using mobile phones, said Martin Curley, director of Intel Labs Europe, during a conference call.

"There's an opportunity for this joint innovation center to shape this, in terms of the synthesis of virtual and physical world and location-based services," Curley said.

Work from the new lab will complement the partnership Intel and Nokia announced in February this year to develop different pieces of software for improving communication and multimedia features in computers, laptops, TVs and even entertainment systems inside cars, Curley added.

Frustrated in the Mobile Arena

Intel is in the business of making chips that are most commonly found in computers, from servers to laptops. The California company has tried over the years to tackle the mobile phone market, though often without successes.

To push its chips into new computing and communication devices, Intel has invested in startup companies and research efforts to create hardware and software for computers and other consumer electronics. The company bought Wind River Systems, an operating system developer for handsets and other devices, for $884 million last year. Intel reportedly is talking to Infineon Technologies (IFNNY) to buy its mobile chip business, according to The Wall Street Journal.

Intel has been keen to promote its Atom processor as the brain powering mobile phones, but Curley said that's not a specific goal for the company's latest research effort with Nokia.

3-D Innovations

Although Nokia is the reigning handset seller globally, it has lost some market share to companies such as Apple (AAPL) in the second quarter of this year. Apple's growing influence in mobile phones has prompted competitors such as Research in Motion (RIMM) to step up their development efforts and offer handsets with more apps for surfing the Internet and managing social media.

Although it'd be cool to see a 3-D hologram of the person you're chatting with, don't count on that technology materializing any time soon. That type of holographic projection would be difficult to develop for a handset, for one, and other 3-D features might be more interesting to consumers in the near future, says Heikki Huomo, director for the Center for Internet Excellence at University of Oulu.

In the near term, the more likely technologies from the new lab would allow consumers to experience the same kind of 3-D graphics in games and movies that bring a virtual world to life, except they will get it from their mobile phones, likely through touch-screen features. Intel and Nokia aren't willing to say when consumers will see the first product using research from the new lab, however.

Will Consumers Open Their Wallets?

Whether consumers will embrace 3-D features in handsets by paying for them isn't assured. For one, many in the computer world thought software such as Second Life, which allows consumers to create their own virtual, 3-D world of characters, communities and commerce, would become widely used. But that hasn't happened.

Curley said Second Life received too much hype. "As with any new technology and experience, it was initially hyped beyond what could be delivered," he says.

Huomo adds that advances in mobile phone technologies are making it possible to support 3-D graphics, so the timing is right to start developing software that will produce these rich, life-like images.

He notes: "We have seen more movies coming out in 3-D, and people getting familiar with 3-D environment."