SEPT. 14, 2007 • Intel Corp. purchased Irish-based Havok Inc. for $110 million. Havok is best known in the middleware space with its specialization of physics engines. Havok will become a wholly owned subsidiary of Intel  but keep operating its business as usual. Havok will add to Intel’s visual computing and graphics efforts, while continuing to develop products for all computing platforms, the company said. That includes helping game developers simulate real world physics in their games, making objects appear to move in a more realistic fashion. Games that have utilized Havok’s tools include BioShock, Stranglehold, Halo 2, Half Life 2, The Elder Scrolls IV: Oblivion and Crackdown. In features films, The Matrix, Troy and Charlie and the Chocolate Factory have used Havok’s tools.  The company has operations in San Francisco, Stockholm, Calcutta, Munich, Tokyo and San   Antonio, Texas.

Impact: Intel is not generally in the business of purchasing software companies so this move is very interesting. What it provides Intel is a solid step up on the graphics front particularly in the gaming space. Intel and Havok have been working together for some time on HydraCore a software technology that optimizes multi-core and multi-threaded hardware for games. The assumption is that Intel will be able to leverage Larrabee, Intel’s multi-core processor, as not just within the gaming market but also with other markets where Havok will now start to branch out. With development pipelines becoming more complicated developers are turning to middleware solutions to help leverage their internal development, as is evident by Intel’s purchase price of Havok. These tools are physics-based engines not game engines like Epic’s UE3, Gamebryo or past game engines like Renderware. The current value placed on the entire games middleware market is currently between $100 million to $200 million. That makes Intel’s $100 million investment stand out.