Canadian software maker Corel, chip maker Intel, and unnamed hardware manufacturers are collaborating on a line of cheap personal computers that would run on the Linux operating system, unconfirmed reports in a Toronto newspaper said.
The Globe and Mail first reported on Thursday that Corel, maker of WordPerfect Office and the CorelDraw graphics suite for Windows and Linux, was in talks on the project with Intel and hardware manufacturers -- possibly the PC Chips Group of Cos. of Taiwan, which already works with both Intel and Corel.
On Friday the newspaper said PC Chips Group had confirmed it was in talks with both Intel and Corel. It also quoted Intel as saying it was not actively involved in talks on such a Linux project.
An Intel-backed computer running on Linux would be a direct challenge to Microsoft`s long-standing relationship with Intel.
Corel issued a statement on Thursday to clarify remarks made to a Globe reporter by company Chief Executive Michael Cowpland.
The remarks were made in reference to general discussions with PC makers about bundling its software, and optimizing its software for Intel`s processors, Corel said.
"Corel CEO Michael Cowpland`s remarks quoted in yesterday`s Globe and Mail were not related to any specific deal or ongoing discussions with any particular company," the Corel statement said.
Corel`s shares closed down 95 Canadian cents to C$22 on Friday in trading on the Toronto Stock Exchange after climbing C$2.35 to C$22.95 on Thursday in response to the speculation.
"We have the problem that Intel is denying stuff. The CEO of Corel has spoken in a semi off-the-cuff manner to a single reporter. It`s not like Corel has put out a press release that Intel has denied," said Duncan Stewart, a portfolio manager at Tera Capital in Toronto.
Denials are par for the course, so there is a 50-50 chance that this speculation could bear fruit, said Stewart.
"Intel could easily go this way and have a Linux operating system running on Intel chips. So this makes a lot of sense from Intel`s perspective. Could it be Corel? Sure," added Stewart.
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