AnandTech reported Monday that Intel had re-assigned engineers from its Digital Home Group (DHG) to a "newly formed tablet organization" led by Doug Davis.
An Intel spokesperson later confirmed the move away from TV. "Intel made a business decision to accelerate top corporate imperatives, which include Ultrabooks, smartphones and tablets."
"As you can imagine, this was a tough decision – Intel led the creation and launch of the smart TV category and its first products. But, these collective actions will help to ensure that Intel has the best people focused on top business priorities."
Intel will now focus its consumer electronics silicon strategy on gateway and IP set-top-box media processors as it scales back on digital TV chipmaking.
AnandTech founder, Anand Lal Shimpi, wrote on his blog, "Intel sees synergy between the tablet and the TV. Perhaps Intel sees the future of Boxee Box/Google TV offerings as being driven by a tablet rather than a stationary set-top box?" D-Link's Boxee Box appeared to indicate just that when it launched an iPad app that lets you view material in your Boxee queue on your tablet instead.
The move has led to many assuming ARM will fill the gap in chipmaking for smart TVs.
Manufacturers tend to blame the high cost of components for why they aren't selling smart TVs. In July, as a result of a poor earnings call, Logitech announced it was dropping the price of the Revue to $99 from $249. Days before a Nielsen report analyzing how people access Hulu and Netflix, found that of the 12,000 people it surveyed, only 1 percent used both services on Google TV.
Meanwhile Gigaom previously reported that ARM was in talks with Google to bring ARM-based chips to Google TVs, which is often criticized for its high price.