In a bid to compete with such rivals as Intel (ticker INTC) and Qualcomm (ticker QCOM) in mobile devices such as smartphones and tablet computers, Nvidia (ticker NVDA) has announced the acquisition of Icera Inc., a start-up in Bristol, England that has spent nine years pursuing an unusual programmable technology for what the industry calls baseband communication functions. The all cash deal for $367 million represents a bet by Nvidia on a novel technology for wireless chips to help build its foothold in smartphones and tablet-style computers.

“As a result of this acquisition we have two of the most important processors in mobile computing,” said Jen-Hsun Huang, Nvidia’s chief executive, in an interview reported in today’s Wall Street Journal (wsj.com).

Icera has designed general-purpose processors that use software to handle different wireless standards, as opposed to the current industry standard of adding special circuitry for each set of communications protocols. That means the same chip could work on 2G, 3G and 4G cellular networks, for example, and be upgraded to handle new features. Each piece of silicon also tends to be smaller, a savings in space and manufacturing cost, Icera says.

Recently conducted tests have found that Icera’s technology was within “spitting distance” of market leader Qualcomm’s. But analysts feel that Icera has struggled to gain acceptance from cellphone manufacturers due to its small size and unproven staying power in the marketplace. As a result of the deal Icera has the backing of a big-name company and Nvidia gets the baseband capability it needs to offer customers a more complete bundle of technology. Mr. Huang said Nvidia still expects its chips to work alongside baseband processors from other companies, when customers prefer it. Meanwhile, having an in-house baseband technology makes it more feasible to create products that combine a microprocessor and baseband on one piece of silicon.

Nvidia, which reports its fiscal first-quarter earnings on Thursday, said Monday it sees the deal slightly trimming its operating profit through the first half of the 2012 calendar year, and adding to it in the second half of next year. The deal has been approved by both companies’ boards and is expected to be completed in 30 days. The stock price of Nvidia is currently trading at $19.64 and has been fairly flat for nearly two months now and appears to be unaffected by the announcement.