LG reportedly plans to build their own in-house mobile chips, and use Intel factories to get the manufacturing done, according to Intel who stated as much during their developer forum today. Rumors of LG preparing to produce their own mobile processors have been around since earlier this year and now with the confirmation having been made public, LG will be more in league with the likes of Samsung and Huawei who also produce their own mobile chipsets, although it may still be some time before the consumer begins to see LG devices which are powered by these processors, especially give that the confirmation was just announced earlier today.
According to the company, Intel's 10-nanometer technology will be used for the chips that LG manufactures, although Intel is also going to start allowing brands to use their factories for manufacturing chips based on ARM's designs as well, which are the results of a newly announced partnership between Intel and ARM that was discussed at the forum in addition to the details about the partnership with LG. This doesn't mean that LG will use ARM designs, but with the partnership in place it's entirely possible that they could at some point.
What it likely does mean is that it could end up being a significant blow to Qualcomm, who is one of the largest semiconductor companies and typically the processor type that can be found in LG's devices. That blow may not be felt immediately, as LG will need to have chips ready for integration with mobile devices and other consumer electronics before they can stop using chips from Qualcomm, eventually though it could mark a notable decrease in revenue for Qualcomm if LG no longer needs to use their processors. It's also possible that they may still have plans to use Qualcomm chips in their flagship devices, while using their own in-house built chips for more entry-level devices and other types of products that they manufacturer, such as TVs and other smart appliances. Although the partnership itself was made public earlier today, the terms of the agreement have yet to be disclosed by either Intel or LG. The announcement of Intel and LG's partnership comes alongside another announcement from Intel, as they also showcased their entry into the VR space with the Project Alloy headset.