The stakes were underscored Wednesday by chip giant Qualcomm Inc., which confirmed it will spend $3.1 billion to buy Atheros Communications Inc., a fast-growing Silicon Valley company that specializing in making chips used in wireless devices.
Qualcomm's move comes as many companies at the giant Consumer Electronics Show here discussed plans to add processing power, networking and wireless Internet connections to devices including TVs, DVD players, TV set-top boxes and other consumer gadgets.
A key goal, said Qualcomm Chief Executive Paul Jacobs, is to allow many home devices to be controlled by smartphones or other mobile devices, which can act as a kind of universal remote control for many gadgets consumer use.
"All sorts of stuff is going to get connected," Mr. Jacobs said in an interview Wednesday. "It's probably the theme of the next five to 10 years in the industry."
Qualcomm's purchase of Atheros, its largest acquisition ever, fills major holes in its communication chip offerings. The San Diego-based company is now mainly known for chips that power cellphones and licensing such technology to handset makers.
Atheros, based in San Jose, Calif., is one of the most successful makers of chips that add Wi-Fi connections to laptop PCs and other products.
But it has added other communications technologies over the years, including the short-range technology called Bluetooth and another that sends data over power lines. Atheros also has a strong position in tablet computers, a market Qualcomm has been moving into.
Other chip makers discussing plans in the field at CES include Intel Corp., Broadcom Corp. and Mips Technologies Inc., Marvell Technology Group Ltd. and ARM Holdings PLC.
Intel's main attraction was a new line of PC chips. But CEO Paul Otellini also stressed that the company is adapting chips for cars, TVs, and other consumer electronics devices.
This past summer, for instance, Intel agreed to pay about $1.4 billion to buy a portion of chip-maker Infineon Technologies AG to gain technology for wireless devices.
Mr. Otellini said the addition of computing power and Internet connections to these new devices is "changing them and changing the world."
Broadcom, which already makes communications chips for set-top boxes and other products, is using CES to talk about developments such as wireless technology that can pass data between smartphones, TVs, camcorders and 3-D headsets.
The company on Wednesday promoted 11 new sets of chips for set-top boxes—including features to offer cable TV operators greater protection against video piracy—and said South Korea's LG Electronics has selected its chips for use in digital TVs and Blu-ray players that connect to the Internet and send TV signals around the home wirelessly.
Marvell, a Silicon Valley chip maker that uses ARM's technology, discussed plans to help accelerate a move of those chips from their stronghold in mobile devices into products for the home.
In one event Wednesday, Marvell and Verizon Wireless said they would collaborate on an effort called Control Point, which uses a device about the size of a power plug as a central connection point to let a smartphone user manage devices in the home such as security systems, lights, heating and air conditioning.
Mips, a Silicon Valley company that also licenses processor technology that is widely used in settop boxes, said it is stepping up plans to enter ARM's turf in smartphones and tablet-style computers.
Nvidia, meanwhile, moved toward larger devices.
The company, which specializes in chips that render images in videogames and other graphics-heavy tasks, said it would make a new class of microprocessors—which serve as the brains of computers—to power products ranging from PCs to servers and massive machines called supercomputers.
Like an existing processor known as Tegra, which is aimed at smartphones and tablet-style PCs, the new development effort is based on microprocessor designs licensed by ARM.
Nvidia executives said the initiative will help extend the technology into high-end systems where it is not widely used now.
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