"[Intel's margins] would've been higher if they didn't make Atom processors [in-house]," he said. "I think Intel is not telling people the truth, which is that they can't make a $29 chip at a profit."

Castellano said that Atom is the real reason for

When the tie-up was announced in March, Intel emphasized that TSMC would help it boost Atom in the as well as penetrate the

Intel's real goal, he argues, is to offload production of Atom CPUs for netbooks to TSMC, a Taiwanese chip foundry, to reclaim space in its own production lines for its profitable Penryn chips.

An Intel spokesman did say that the chipmaker hasn't publicly stated which kinds of Atom CPUs TSMC will be manufacturing. But that's because, at least in part, "we're still working on the exact details with them," he said.