Silicon Valley Watcher - reporting on the business of technology and media

Tuesday morning Intel (an SVW sponsor) hosted a media conference introducing a new Atom microprocessor code named Pine Trail and released Moblin Version 2 Beta into the community of open source developers.

There was little performance data on Pine Trail, it's primarily a shrink from a 3 chip to 2 chip-set, which will probably result in about a 30 per cent performance boost and extended battery life in new netbooks that come out in the fourth quarter of this year.

The more interesting announcement was the release of Moblin and its user interface, into the open source community. This mobile Linux is optimized for the Atom architecture but will run most Linux applications and Linux middleware. But to get optimal performance software developers will need to optimize their applications for Moblin. Intel says that the port will be very easy.

The user interface to Moblin is smart, it gives easy access to user's Internet activities, especially social networks. Users can see friend updates without having to log in.

More importantly, Moblin will make netbooks a lot less expensive if the manufacturers don't have to pay a license fee for a Microsoft OS. Until MSFT optimizes its OS for netbooks, Moblin should offer a faster user experience.

Intel down played any competition with MSFT, saying its OEM manufacturers wanted an option. Intel has been a long time contributor to Linux to ensure there is always a broad OS choice for its chips. And clearly, Mobil will compete with MSFT to some extent. It might even spur MSFT to produce a Moblin-like experience on netbooks, otherwise it might lose out if netbooks become more like notebooks.

Intel is trying to not make netbooks into a potential PC or notebook replacement because it's margins on notebook chips are so much greater than for netbooks. For example, it repeated that Atom is not designed for high-end games and that future versions such as Pine Trail won't play more than basic games.

But, Atom netbooks aren't that great at streaming video, at least not the ones I've played with. If Intel gives Atom good streaming video capabilities then netbooks might become a potential notebook replacement for more people. Streaming video capability might then become be the trojan horse for cannibalizing notebook sales. And if Intel doesn't do it, Nvidia could do it with its graphics chips for netbooks.

Will Atom-based netbooks become notebook competitors? Can Intel keep Atom down? History shows that low-end technologies will always become ever more powerful.

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You can see a video of Moblin here.

Moblin Zone

http://www.intel.com/pressroom/archive/reference/Pineview_Moblin_disclosure.pdf

Intel (an SVW sponsor) on Monday morning (May 11) is launching its largest marketing campaign in 3 years and its first promoting the company and not a product.

The "Sponsors of Tomorrow" campaign is focused on the people of Intel and will be initially launched in the US, Germany, and UK, then rolled out to more than two dozen countries, reaching Brazil and Japan in the third quarter. It is expected to run 3 to 5 years.

The campaign is being launched at NASDAQ in New York's Times Square.

In honor of the occasion, Heather Dixon, Consumer Marketing Manager of Intel Corporation [INTC], and Intel engineers featured in some of the advertising will ring the Opening Bell to launch "Sponsors of Tomorrow," the new global campaign emphasizing Intel’s future-focused brand. This is the first time that NASDAQ’s traditional bell has been replaced by another sound, the familiar Intel bong.

A couple of weeks ago, my son Matt and I drove up to Portland, OR to visit Intel's R&D labs. We were there with some fellow Intel Insiders, Cathy Brooks, Sarah Austin, Frank Gruber, and Irina Slutsky.

Here is a brief video of some of the highlights of our trip. We got to see Intel healthcare products and speak with researchers in this area. We also visited Intel's WiFi and WiMAX labs. Portland has about 700 square miles of WiMAX and we got to test it out in cars and in our hotel rooms. It works great. I'm looking forward to its arrival in San Francisco.

Intel has been a long time supporter of SVW for many years. Intel has also been a pioneer in social media among large companies thanks to Ken Kaplan, Bill Kircos, Bryan Rhoads, Bill Calder, and many others at Intel.

In "Intel's Social Media Story - just the beginning," Bryan Rhoads looks back to when Intel first started and forward to what's ahead. This article is from blogs.intel.com.

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By Bryan Rhoads

We introduced Intel's blog program 2 years ago this month. I'd like to use this Intel anniversary as an opportunity to reflect and look back at some of our social media efforts over the past decade.

Its not possible to go into every project and program in one blog post. Nor can I properly speak to all of the hard work from our various social media teams. So, I look to others to help fill in those gaps, but here's a high-level overview of just some of the activities to date at Intel.

We created Blogs@Intel as a new business tool for our customers and employees to directly communicate and collaborate from keyboard to keyboard. We launched the blogs on April 10th 2007.

Yet in fact, our social media story started much earlier. 8 months prior, we launched our IT@Intel pilot blog. It was a big success, so we launched more blogs, including this one. Moreover, the Intel Software Network started our popular developer blogs and wikis for software collaboration back in May of 2006.

Internally, grassroots employee blogging started as early as 2003 consisting mainly of self-maintained servers under desks. These internal employee blogs gained a tremendous following. Intel CEO Paul Otellini launched his employee blog in 2004. Other top execs and leaders followed throughout 2005 culminating in a fully IT-supported platform that same year.

Team-based wiki collaboration started in 2004, culminating in our enterprise-wide "Intelpedia" created by Josh Bancroft in November of 2005. Today, Intelpedia contains over 15K 30K articles from Intel employees defining, collaborating and documenting their part of the vast Intel workplace. Intelpedia was founded in the spirit of open information sharing and community moderation of content, much like the very popular Wikipedia.

We created all of these social spaces to foster dialogue and make important contributions to a widening range of issues relevant to our customers, to our employees and to the future of technology.

Since then, we were the first to offer a corporate blog in the People's Republic of China with Blogs@Intel China (ok, Dell may have beaten us by a few days in May ‘07, but I'll need to exchange notes with Lionel about that). We soon followed with Russian, Portuguese, Spanish, Japanese and English blogs on topics ranging from corporate social responsibility and research to jobs and customer support. Intel's on-domain social media offering now totals over 35 blogs and vibrant communities.

I'm driving up to Portland later this week with my son Matthew (21) and visiting Intel's research and manufacturing facilities. I'll be part of a group of "Intel Insiders."

I'll also be meeting with Intel executives such as Eric Dishman of Intel's Health Research and products division (video here: http://bit.ly/zsYyC ). And we will be testing out Portland's WiMAX. Hopefully we'll have WiMAX in Silicon Valley before too long.

There will be a "Tweetup" on Thursday at 7pm at the Green Dragon hosted by the Portland Social Media Club, more details here (and thanks for the graphic.) And I hear Intel is buying the first round of beers, so please stop by.

On Twitter we'll be replying to @Intel and using the #IntelInsiders hashtag if you'd like to follow our progress.

I'll be posting news, tweets, and taking some video, plus reports from my road trip up and back. So please stay tuned for the SVW Road Trip to Portland, leaving Wednesday afternoon.

(Intel is a sponsor of SVW).

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Please see:

Social Media Club PDX » Blog Archive » Social Media Tweetup. Meet Social Media Insiders on April 16

On Thursday, April 16 Intel will host a visit by several “Intel Insiders.” These folks are literally the who’s who in social media and technology and they’ll be in P-town checking out Intel’s tech and touring their fabs and research centers. As a special bonus, they’ll be heading downtown in the evening to join several folks from Social Media Club PDX at The Green Dragon Pub for chit-chat and beer.

Who are these so called Insiders? Well below is a list with links to their respective web properties:

• Sarah Austin from POP17 @pop17
• Irina Slutsky Geek Entertainment @irinaslutsky & producer/videographer Eddie Codel eddie.com @ekai
• ”Somewhat” Frank Gruber Somewhat Frank @frankgruber
• Tom Foremski Silicon Valley Watcher @tomforemski
• Cathy Brooks – Other Than That @cathybrooks

Sweet, huh? Join your fellow Portland Social Media Peeps on Thursday, April 16 from 7:30 to 8:30 for a Tweetup at the Green Dragon. And if the notoriety of these Insiders isn’t enough to spark your interest, Intel will provide the first round of beers (depending on how many people show up). We hope to see you there!

[Intel is a sponsor of SVW]

Intel today revealed impressive benchmarks for its new Nehalem Xeon 5500 server microprocessor, calling it "transformational" in terms of it's expected effect on customer's applications.

The new chip represents a large jump in performance when used in data center applications due to integrated support for IT technologies such as virtualization and from Intel's ability to pack more transistors onto the chip using its latest 45nm manufacturing technology. It also reduces power consumption.

"This is the big one," said Pat Geslinger, senior VP at Intel. He demonstrated one Xeon 5500 based server out performing nine servers. Intel expects that the large cost savings data centers can achieve through consolidating servers and also from lower administration costs, lower power bills, represents a compelling reason for data centers to retire their old gear.

The performance and total cost of ownership numbers certainly do point towards a massive reboot by data centers installing Xeon 5500 servers, especially since current economic conditions are creating enormous pressure to aggressively reduce business costs. However, IT managers are very conservative and it can take many months for them to qualify a system and make sure it works with all applications. To help speed this process, IT vendors have already seeded Nehalem based systems with large customers months ahead of today's official launch.

Dell, HP, IBM, Cisco Systems, and many other IT vendors today announced Xeon 5500 based servers.

The high performance provided by the Nehalem microprocessor architecture makes the chip more competitive with RISC based microprocessors such as Sun Microsystems SPARC and IBM's POWER microprocessors. Nearly half of the server market is RISC based. This represents a massive market opportunity.

It is this threat to the RISC server market that could be behind reports that Sun has been actively seeking a buyer for the past few months. It is very expensive to maintain a roadmap for SPARC that keeps pace with Intel's performance improvements in its server family.

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Please see:

Nattering nabobs of negativity nixed by Nehalem

- Upcoming Intel Chip Launch Could Spark Massive Wave Of IT System Disruption

- Dell Makes Big Bet On Enterprise IT In Bid To Boost Profits

Intel promises faster, greener, cheaper computing with Xeon 5500 | Between the Lines | ZDNet.com

Intel highlighted some performance benchmarks, looked at specific servers, compared the performance against the previous generation chip, and found performance benchmarks that increased by more than 150 percent in some cases.

The company also pointed to enhancements in the memory subsystem, as well as the I/O subsystems. And it made note of the improvements that will enhance virtualization benchmarks.

IBM revamps server lineup based on Intel's Nehalem | Between the Lines | ZDNet.com

Monday, Intel will officially launch it's most important chip in more than 15 years, a high performance Xeon server microprocessor built using its advanced Nehalem design. It has the potential to shakeup not only the microprocessor market for IT systems but also trigger a tsunami of data center upgrades worldwide.

The reason is its exceptional performance and a design that significantly reduces power consumption. On Monday, Intel and customers such as Hewlett-Packard, Sun Microsystems, IBM, Dell, Cisco Systems, and others, will release benchmarks that are expected to show dramatic performance improvement across a broad range of business applications.

"With one Nehalem server customers will be able to replace nine servers. And that's before using virtualization, with which you'll be able to replace as many as 18 servers, and reduce power consumption by abut 20 percent," said Kirk Skaugen, VP and General Manager of Intel's Server Platforms Group.

Nehalem has been in development for four years and is manufactured on Intel's most advanced 45nm chip technology. This dramatically speeds up performance and reduces energy use because electrons have shorter distances to travel and there is less leakage of power.

"When I joined Intel in 1992, the fastest supercomputer performed at 93 gigaflops and cost $130 million. One Nehalem server will give you the same performance," said Mr Skaugen.

This combination of high performance and support for critical IT technologies such as virtualization, means data centers will be able to reap massive cost savings by consolidating the number of servers in their data centers. This means lower administration costs, and big savings on power consumption -- two of the largest issues facing data center managers.

Mr Skaugen said that a Nehalem server will pay for itself within just eight months. "After 8 months they become cash machines," said Mr Skaugen.

With these types of dramatic cost savings, and the extraordinary economic pressure on data centers to reduce operational costs because of the recession, Nehalem servers could trigger the largest upgrade cycle ever seen in IT systems worldwide.

The exceptional performance of Nehalem systems could also trigger a consolidation of the microprocessor market for IT systems, which includes server chips from Sun Microsystems with its SPARC, and IBM's POWER microprocessors. This RISC market has been in Intel's cross-hairs for more than a decade but now it holds a strong hand of cards, including the availability of Sun's Solaris operating system on Xeon, which will make migration from RISC systems easier.

The Itanium microprocessor, introduced with much fanfare in 2001, was Intel's first attempt to take on the lucrative RISC microprocessor market. Although Itanium failed to meet its high expectations, Intel's Xeon server chips based on the PC X86 architecture succeeded in dominating the low end of the IT systems market.

However, nearly half of the installed server market is still RISC microprocessor based, valued at about $27 billion, said Mr Skaugen. For the first time, Intel's customers can build IT systems that are highly competitive with RISC based IT systems on performance and total cost of ownership.

In addition, the quad-core design of Nehalem means that single core Xeon servers are also ripe for replacement.

That means there are tens of billions of dollars in business opportunities opened up by Nehalem based servers in replacing aging IT systems worldwide. This will essentially lead to the complete rebuilding of global IT resources and the Internet itself. And it will potentially spark a reordering of the IT vendors as new entrants into the server market such as Cisco Systems, and low cost computer makers such as Dell, move to establish significant market shares.

Sun Microsystems is especially vulnerable. Its SPARC microprocessor has a good track record for performance and low power use but Sun must maintain large investments in keeping it competitive. That scale of investment is increasingly challenging for Sun especially with the competition from Nehalem. This is very likely the reason Sun has been seeking to be acquired.

If IBM were to buy Sun the RISC microprocessor market could be consolidated into a single architecture and development could be concentrated into producing POWER based IT systems that could potentially maintain a performance and cost of ownership competitive with Intel's Xeon server microprocessors.

[Intel is a sponsor of SVW]

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Please see:

Sighting Nehalem and Dawn in the Wild - Bits Blog - NYTimes.com

Nehalem servers to anchor Intel cloud computing | Nanotech - The Circuits Blog - CNET News

Intel Nehalem (microarchitecture) - Wikipedia

What you need to know about Intel's Nehalem CPU - Ars Technica

Andy Grove, a former CEO and chairman of Intel, the world's largest chip company, will receive a lifetime achievement award at a ceremony on May 2 at the Computer History museum in San Jose, CA. [Intel is a sponsor of SVW]

The award also marks the 50th anniversary of the integrated circuit - the first semiconductor technology that led to creation trillions of dollars in new industries and new markets.

Mr Grove will receive the award from the National Inventors Hall of Fame (NIHFF), established in 1973 by the U.S. Patent and Trademark Office. The NIHFF honors inventors who contributions have enabled human, social, and economic progress.

The 2009 class of inductees, announced last month in Washington, D.C., is comprised of 15 innovators who pioneered advances related to or enabled by the integrated circuit.

As the recipient of the Lifetime Achievement Award, Dr. Grove is being recognized for his outstanding contributions and extended commitment to invention and technical innovation in the semiconductor industry. Along with 2009 inductee Gordon Moore, he participated in the founding of Intel Corporation in 1968, and he served successively as President, CEO and Chairman of the company from 1979 to 2005. During Dr. Grove's tenure, Intel dramatically contributed to the power, utility and ubiquity of computing devices.

"The world we live in today is scarcely imaginable without the contributions of Andy Grove and all 15 of this year's inductees," said James Pooley, Chairman of the National Inventors Hall of Fame. "So many of the technologies we take for granted nowadays, including everyday consumer electronics like cell phones, computers, and DVD players, rely on semiconductor technologies that only exist thanks to their hard work and spirit of invention."

More information: www.invent.org/2009induction.

Gordon Moore, one of the co-founders of Intel, will also be inducted into the hall of fame at the same ceremony along with nine living and five posthumous inventors.

Here is the list:

[Intel is a sponsor of SVW]

Advanced Micro Devices (AMD) refuted Intel's claim that it has violated the terms of a secret cross-licensing agreement that allows it to manufacture X86 microprocessors and said it was an attempt to distract from "global antitrust scrutiny" of Intel business.

AMD has tried to cut its business costs by creating Global Foundries, which would make chips for AMD and also other third parties.

Monday morning Intel said it had notified AMD that it "believes AMD has breached a 2001 patent cross-license agreement with Intel."

Intel believes that Global Foundries is not a subsidiary under terms of the agreement and is therefore not licensed under the 2001 patent cross-license agreement. Intel also said the structure of the deal between AMD and ATIC breaches a confidential portion of that agreement. Intel has asked AMD to make the relevant portion of the agreement public, but so far AMD has declined to do so. AMD's breach could result in the loss of licenses and rights granted to AMD by Intel under the agreement.

Intel Notifies AMD of Cross-License Breach

The two companies have an agreement to try to resolve the dispute through mediation.

AMD said Intel had "manufactured this diversion as an attempt to distract attention from the increasing number of antitrust rulings against it around the world."

The AMD statement said:

AMD remains in full compliance with the cross-license agreement. And as we’ve stated all along, the structure of GLOBALFOUNDRIES takes into account all our cross-license agreements. We will continue to respect Intel’s intellectual property rights, just as we expect them to respect ours.

AMD said that Intel's attempt to terminate the license was itself a breach of the agreement and that AMD had the right to terminate Intel's license.

The AMD/Intel cross-license agreement is a two-way agreement, the benefits of which go to both companies. Intel leverages innovative AMD IP critical for its product designs under the cross license. This includes AMD patents related to 64-bit architecture extensions, integrated memory controller, multi-core architecture, etc.). The cross-license is very much a two-way street.

AMD says Intel trying to distract from antitrust scrutiny

(Intel is an SVW sponsor.)

Intel, the world's largest chipmaker, today announced a deal with Taiwan Semiconductor Manufacturing Corporation (TSMC) that gives the world's largest chip foundry the rights to manufacture chips for third parties containing Intel's Atom microprocessor design.

TSMC makes chips for hundreds of other companies. This deal will allow its customers to integrate Atom into their designs.

Intel, TSMC Reach Agreement to Collaborate on Technology Platform, IP Infrastructure, SoC Solutions

The Intel Atom processor features 47 million transistors and is Intel’s smallest processor. Products manufactured through the agreement may find adoption in embedded CPU market segments such as mobile internet Devices (MIDs), smart-phones, netbooks, nettops, and AC-powered consumer electronics device. The processor is designed to bring the whole Internet and the benefits of computing to an emerging class of consumer-friendly devices.

Foremski's Take:

This is the first time Intel has allowed other companies to integrate its microprocessor technology into their designs and have them manufactured by a foundry.

The move should help boost the use of Atom in a broader range of digital devices beyond the initial netbook focus. But much will depend on Intel's licensing terms. Netbooks and other digital devices are price sensitive.

The move takes pressure off of Intel in terms of integrating Atom into a family of different chips that can be used in different types of devices. Other chip designers will be able to combine Atom with a library of other designs to create unique chips with advanced features--and with a faster time to market.

Wider use of Atom also means it will be easier to design the software for Atom based devices because there will be more tools and more people with Atom design experience. This will bring down the costs of Atom-based products and increasing their popularity.

[Intel is a sponsor of SVW]

Craig Barrett said he would retire as Intel chairman in May. It's a major loss for Intel because Mr Barrett was a key figure in helping Intel continue its dominance of the microprocessor markets and hold its position as the world's largest chipmaker.

He did that by focusing on chip manufacture. And that's the real secret of Intel's success-- not design but manufacture. Intel can build and ramp up a chip fab (one of the most complex industrial factories of our time) in record time, and do it again, and again, and again. There are hundreds of different processes involved in making chips, and hundreds of complex and very sensitive machines -- it's not an easy task to get the calibration done right. If you mess up in one process you lose the entire batch of chips and you quickly start to lose huge amounts of money.

Mr Barrett developed a process of copying exactly a fab in a new fab, and rapidly distributing process gains to its other fabs. This meant Intel could quickly build very complex fabs, and importantly, achieve very high manufacturing yields (something which rival Advanced Micro Devices always struggled with). Mr Barrett leaves Intel in a very strong position.

Here is Paul Mooney's recent video of Intel chairman Craig Barrett talking about Intel's involvement in the "Small Things Challenge." Intel will contribute 5 cents per click if you visit the site.

Here are more details on his retirement and replacement:

Here is Paul Mooney's  video of Intel chairman Craig Barrett talking about Intel's involvement in the "Small Things Challenge." Intel will contribute 5 cents per click if you visit the site.

At least 80% of humanity lives on less than $10 a day, while 75 million children worldwide are not in school. By pooling surprisingly small investments, we can help to significantly improve educational access and economic development. It’s called The Small Things Challenge, and it’s a campaign based on the premise that every small action can make a big difference to ensure quality education and economic opportunity for all. We challenge you to join us in becoming a part of the solution. Your help will make a difference.

Please see:

Stars Join Intel, Kiva, Save the Children, Launch Small Things Challenge Campaign

Intel, the world's largest chipmaker, wants affordable high speed wireless broadband to top US technology initiatives, said Craig Barrett, Intel chairman at a meeting at the Consumer Electronics Show (CES) in Las Vegas.

Intel has made significant investments in WiMAX technology, a wireless high-speed broadband technology that can potentially provide inexpensive Internet access to consumers and businesses over large distances without the need for local wifi antennas.

WiMAX will become integrated into future Intel chipsets in the same way that WiFi technology has become a standard part of its desktop and notebook products. However, there needs to be a substantial WiMAX infrastructure to take advantage of the WiMAX chipsets.

Mr Barrett has provided advice to President Bush on technology initiatives, and he and other industry executives are likely to do the same for President-elect Barack Obama administration, and whoever is appointed to a newly created position of US "Chief Technology Officer (CTO)."

Intel is conducting a survey at CES to gauge support for WiMAX, and other technology initiatives, among US voters. The survey questions include:

How would you rank the following - with 1 being the most important and 3 being the least important - for the Obama Administration’s CTO regarding technology and broadband/Internet?

- Provide incentives to citizens to make fast, affordable, high-quality broadband deployment a reality for all Americans.

- Focus on federal initiatives that expedite the roll-out of wireless broadband technologies across entire cities.

- Advocate open spectrum policies that enable mobile carriers and manufacturers to make market-driven agreements to deploy next-generation wireless broadband technologies like WiMAX.

Intel Chief Technology Officer Justin Rattner will include the survey results in a letter he is planning to send to President Obama's CTO.

WiMAX could help make Internet access more affordable to larger numbers of people and help bridge a digital divide. It would also help spur sales of computers and servers for Intel, as well as for many other tech companies involved in building a national WiMAX infrastructure.

High-speed wireless Internet would also make it possible for many smaller companies to offer new types of services that require fast connections and help the US catch up with countries that already have a well developed infrastructure of high speed broadband.

(Intel is a sponsor of SVW)

Foremski's Take:

President elect Barack Obama and his advisors have proposed a stimulus package to boost an ailing economy that would invest in infrastructure projects. These would include new bridges, repairing roads, sewer systems, etc. It would make excellent sense to also invest in building a 21st century digital infrastructure.

In the same way that the US economy was helped by the building of a nationwide road and rail network, similar benefits can be realized from a nationwide high-speed digital network.

The US has fallen far behind other countries in terms of broadband speeds and availability. In Greece and Estonia, Internet access has been designated a basic human right and the government has a responsibility to ensure all its citizens have access to this resource.

While the US is unlikely to amend its constitution, a national grid of affordable digital highways, will be just as important as roads and railroads to the health of an economy. For example, inexpensive high speed connections would make it easier to implement distance learning programs, and telecommuting. This would save on travel and fuel costs and be beneficial to the environment. And there would be certainly be plenty of new types of applications and services developed on top of such a platform resulting in new jobs and new markets. A lot of SIlicon Valley companies have business models that rely on customers having easy and affordable Internet access.

WiMAX is one of the technologies that can make this possible and help break the duopoly control of the telcos and cable operators on consumer Internet access. More competition and faster Internet connections will contribute to a strong digital economy.

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Please see:

Research@Intel · Get Out the Tech Vote at CES

Businessweek reports:

CEO Search: Can Anyone Save Yahoo?

What Yahoo needs, say management recruiters and analysts, is someone with the profile of Hewlett-Packard (HPQ) CEO Mark V. Hurd. A low-key operating wizard from the relative tech backwater of NCR (NCR), Hurd has managed to turn around HP in the three short years since he joined. In fact, one source close to the search says Yahoo isn't ruling out an executive outside the Internet realm. "You need someone who doesn't have the ego of a rock star," says Dona Roche-Tarry, a partner at executive search firm CTPartners. "But the new person would need the strength of character to stand up to Yang and the board."

Here is my pick: Sean Maloney, Intel's executive VP and its chief sales and marketing officer.

Sean Maloney has been Intel's top trouble shooter for many years. He is the one that Intel relies on when troubled business groups need to be turned around. He always gets the toughest jobs at Intel.

He is one of the most capable executives in the tech industry right now. My contacts tell me he was in the running for CEO of Hewlett-Packard following Carly Fiorina's departure but withdrew deciding to stay with Intel and the job later went to Mark Hurd.

Mr Maloney has been at Intel since 1982 and he has hit a ceiling. Paul Otellini, CEO and President of Intel isn't going anywhere, he took over in May 2005, and at age 58, he still has many years until retirement.

Yahoo would be a fantastic challenge for Mr Maloney, but he thrives on challenging situations and has had plenty of experience revamping poorly performing Intel business groups. He is fiercely loyal to Intel but he might be tempted by the enormous amount of value that would be created in turning around Yahoo. Intel has won the microprocessor wars and there isn't much else to do except to stay out of anti-trust courts -- that's a job for lawyers not for hard charging executives.

Yahoo needs a swift kick in the pants to get it going again. It's got great technologies and people but it is rudderless. Mr Maloney would be the best person to get Yahoo moving again and regain its former glory, imho.

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Please see:

From Peter Chernin to Mark Cuban: Picking Jerry Yang’s Replacement

TimesOnline: Sean Maloney, the Londoner inside Intel

An Intel experiment in cooling data centers has discovered that cooling servers with plain outside air is almost as effective as air conditioners. There was only a tiny increase in server failure. [Intel is a sponsor of SVW]

This could save data centers millions of dollars in power costs and allow expansion. Currently, many data centers have limited expansion options because they are limited by how much electric power they have available.

Here are the details from ZDNet:

. . . The experiment was run for 10 months, between October 2007 and August 2008. Server units with over 900 blades, used for production design, were split into two compartments. One of the compartments was air cooled, with temperatures ranging from 18 to 32°C. The other compartment was cooled using air conditioning, and used as a control.

. . . Intel used a normal air filter that took larger particles out of the air but not fine dust. While the 32 servers and racks became coated in dust, and humidity was monitored but not controlled, the failure rate was 4.46 percent, compared with a 3.83 percent failure rate in Intel's main datacenter over the same period.

. . . Intel estimated an annual cost reduction of approximately $143,000 (£79,000) for a small, 500kW datacenter, based on electricity costs of eight cents per kWh. In a larger 10MW datacenter, the estimated annual cost reduction was $2.87 million.

Foremski's Take: This is a big power saving. This will enable expansion in some data centers but it could also put off the installation of more power efficient hardware based on Intel's latest power-saving chip sets, and also power saving hard drive systems from 3PAR and others. Power savings have been a key incentive for many data centers to rip out and replace their older power hungry gear.

Since environments such as high humidity are less of a problem maybe we'll see server farms combined with greenhouses :-) Cloud computing plus vine-ripened tomatoes.

Please see:

Intel Community: Free Cooling for Data Centers - video and whitepaper

http://wikis.sun.com/display/freeaircooling/Free+Air+Cooling+Proof+of+Concept

I spent much of the day at the Intel Developer Forum Wednesday at the Moscone in San Francisco (Intel is an SVW sponsor). It was great to bump into old UK buddies such as Joe Fay, news editor at The Register, and Mike Magee, the UK's most entrepreneurial journalist, and many others, including a bunch of my favorite ex-Podtech people.

Here is a short peek into my day at IDF.

A short description:

Here is part of my day at Intel Developer Forum. You get to see some of the Intel Insiders in action; plus you meet the founder of XIHA Life, a multi-lingual social network site from Finland, and a lady from Intel, demos TV widgets, developed by Intel and Yahoo.

Included: cameo's from well known local bloggers and personalities, such as Cathy Brooks, JD Lasica, Eddie Codel, Jeremiah Owyang, Chris Heuer, Ken Kaplan, Christine Ngo and other familiar faces...

Jeremiah Owyang

Cathy Brooks

Eddie Codel

JD Lasica

Ken E Kaplan

Chris Heuer

Christine Ngo

Please see: UK's Pioneering Publisher Mike Magee Launches Indian-based IT Publication

Intel (An SVW sponsor) today announced it would give out four awards of $100,000 each for innovative ideas in education, healthcare, economic development and the environment in 2009.

The announcement was made by Craig Barrett, chairman of Intel, speaking at the Intel Developer Forum in San Francisco.

Dean Takahashi from Venturebeat reports:

I can remember years when Barrett, as CEO, came out on stage to pound home the message that Intel’s processors were better than those from Advanced Micro Devices and we would all one day be using computers with Itanium chips. Now that there are a billion Internet users in the world, Barrett is taking his foot off the pedal on that hard sell on Intel. It tells you, perhaps, how unconcerned Intel is about competition now that it has reasserted its dominance over AMD and what Barrett really cares about.

Intel Developer Forum: Chairman Craig Barrett takes us on a world tech tour » VentureBeat

I'll be at IDF on Wednesday and Thursday.

Here is some additional info on todays IDF from Annie Rodkins:

The conference unofficially started today with a press briefing put together by Intel’s Corporate Technology Group – the guys and gals who run R&D here at Intel. Here, researchers spoke about their vision of the future as Connected Visual Computing; you can catch up with Intel Fellow Jim Held at http://tinyurl.com/58hnlc or see some pretty amazing slides and highlights athttp://tinyurl.com/5e9cc2.

Rehearsals took place for two talks that will be livecast on Tuesday: “Using Information Technology to Meet 21st Century Challenges & Opportunities” and “Nehalem: Screaming Performance, Efficient Power.” For links to livecasts see http://tinyurl.com/5mtsek.

Lastly, the Upload Lounge is all set and ready to host bloggers and podcasters the world over:http://tinyurl.com/5j6mcm. Tomorrow at the Lounge you will be able to meet some guests from Craig Barrett’s opening keynote (we can’t say who), astronaut Story Musgrave and Intel Sr. Fellow Gene Meieran, and others.

Intel [a SVW sponsor] has responded to Advanced Micro Devices acquisition of graphics chip giant ATI Technologies. At the coming SIGGRAPH 2008 industry conference Intel is revealing details of its "Larrabee" visual architecture, which describes its graphics technology.

Here is Intel's account of what it will discuss at the show:

Details unveiled in the SIGGRAPH paper include a new approach to the software rendering 3-D pipeline, a many-core (many processor engines in a product) programming model and performance analysis for several applications.

The first product based on Larrabee will target the personal computer graphics market and is expected in 2009 or 2010. Larrabee will be the industry’s first many-core x86 Intel architecture, meaning it will be based on an array of many processors.

There is a lot of detailed info here Monday morning: http://doi.acm.org/10.1145/1360612.1360617

Foremski's Take:

AMD's acquisition of graphics chip leader ATI Technologies forced Intel to come up with a response. In the mean time, the acquisition has been troublesome for AMD. The valuation of the deal had to be drastically reset leading to a massive $1.6 billion write off for AMD.

Also, the management time required to integrate ATI has not helped AMD capitalize on its lead in low-power server microprocessors.

Intel [INTC] hasn't had to deal with such a distraction [think GOOG versus YHOO if MSFT had succeeded...] it has had time to craft its response, which is Larrabee.

An additional advantage for Intel is that it can include Larrabee in its chip sets as an easily integrated technology from scratch. AMD has to work to integrate ATI's architecture with its process technology.

Also, AMD has to juggle its production through its own chip fabs versus fabless production models. One of the advantages of the ATI acquisition is that AMD can learn from ATI how to better use foundries to improve its history of production problems.

However, AMD's German based chip fabs make it difficult for the company to switch to foundries because of the commitments it made in return for tax and other government support. Chip fabs, unless they are run at 95 percent plus capacity are a quick way to lose lots of money. As the chip fabs get larger, there are fewer chip companies that have the volumes required to keep chip fab production lines full.

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Jon Peddie, a leading analyst on graphics talks about Larrabee:

Why not Larrabee? :: JPR Staff blogs

When is a GPU not a GPU?

One final note. GPUs. Larrabee is not a GPU in the sense an ATI, Nvidia, or S3 chip is a GPU. It is gang of X86 cores that can do graphics processing, so it is a GCPU – graphics capable processing unit, as are ATI, Nvidia, and S3’s chips.

(Intel is a sponsor of SVW)

Intel announced plans for a new business group manufacturing system-on-a-chip (SOC) semiconductors. SOCs are souped-up microprocessors that are tuned for specific types of devices, such as mobile internet devices, smart phones, or medical devices.

Intel's SOC chips combine a microprocessor with memory, graphics, and embedded software plus specialized chip and software functions.

SOCs can shrink almost an entire board of chips into just one or two chips. This makes digital products more reliable and less expensive to make.

Intel predicts that within a few years there will likely be billions of digital devices connected to the Internet. Most of these billions of devices won't be PCs but will include virtually any industrial, office, or home electronics device that can benefit from some processing and Internet connection--which is most electronic products. Intel wants its PC architecture to move into many different devices helped by the massive number of Intel architecture software developers.

To target non-PC products Intel is making SOCs that are specially designed for a specific product category.

Intel has several advantages against SOC rivals:

- It owns advanced fabs in which its design software is already tightly integrated into the complex process technologies used to make chips. It takes several hundred processes to make a chip and each machine has to be finely tuned to the design--minute differences can lead to low yields and other problems.

- Most SOC rivals rely on third party chip foundries to make their chips and sometimes it can take several months to fine tune a production run.

- Intel's microprocessor design is difficult to clone.

- Intel has unique chip functions that it can easily combine on its process technology.

Wednesday it announced 8 SOC chips and said it would have 15 SOCs in 2009.

Foremski's Take:

I asked Intel if it would make an SOC only for one customer. I was told that the goal is to create a broad family that would be available to any buyer.

However, Intel already makes specialist products for just one customer. It makes the motherboard for Apple's MacBook Air. It was given just a year to design the board, which gives the MacBook Air its super slim shape and lightness. It was a challenging project but Intel managed to do it--and it did it for just one customer. Why not do the same with SOCs?

One way for Apple to reduce its future costs of manufacture is to shrink as much of a notebook computer's motherboard onto SOC chips, making it a natural customer for Intel's SOC group.

If that were to happen, would Apple seek to enhance the uniqueness of its notebooks and hardwire special functions into the chip that would provide its products with special qualities--but also guard against clones?

Could others follow? Would it make sense for Dell notebooks to have different sets of chip based features from Lenovo or other notebooks?

Closer to customers . . . SOCs can also tie customers more closely to Intel because switching to rival Advanced Micro Devices' microprocessors would be more difficult due to the specialist nature of the chips.

Fragmenting the PC platform? There will be at least 15 different SOC platforms next year with different sets of capabilities--that means software won't be easily portable between the many Intel PC architecture platforms.

The SOCs will represent fragments of a 26 year old PC platform standard. It'll be interesting to see how those fragments will grow into billions of connected devices. Intel's latest business launch seeks to make a big impact on the future of tech.

WSJ: Intel Brings Out Multifunction Chips

News.com: Intel storage chips point to SoC future

- - -

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[Intel is a sponsor of SVW]

Intel today announced the Centrino 2 chip set which is its most powerful mobile processor. The Centrino, launched in 2003 was incredibly successful for Intel, its most profitable product. The world's largest chipmaker hopes to repeat that success with the Centrino 2.0.

Here is a short video of Intel's presentation boiling down the key advantages of the Centrino 2 in consumer and in enterprise uses.

The best part of this video is when Intel talks about the technology trends it is seeing. Especially the fact that social networks now represent an incredible 25 % of Internet bandwidth.

Something has changed deeply - we're not in Kansas anymore.

YouTube - Centrino 2 - And Social Media....

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On a recent visit to Intel as part of the Intel Insider group, Sean Maloney, Intel's CMO, talked about online marketing.

In this clip Mr Maloney talks about sometimes feeling that he is in a "fog" in terms of online marketing because of the fragmented nature of the online world. This is a good example of the challenges facing nearly all Chief Marketing Officers, a job that has become one of the most challenging in any organization.

[Please see: Chief Marketing Officer - Toughest Job Around . . .]

http://www.youtube.com/watch?v=h0jch0hlnwM

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Tuesday I was over at Intel as part of an Intel Insider group meeting. Sean Maloney, number 2 executive at the world's largest chipmaker discussed the reasons why Intel has moved nearly all of its advertising away from TV. As Chris Heuer points out in the comments, Intel has been moving towards a nearly complete online spend over the past year.

And it is moving a lot of money. The problem, however, is where to spend it.

In this video Mr Maloney also talks about Intel's first lessons with online media.

http://youtube.com/watch?v=C5g9RBGm7j8

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[Intel is a sponsor of Silicon Valley Watcher.]

I'm a member of a small group of advisors to Intel to provide consulting and feedback on corporate communications programs being developed by the world's largest chip maker.

Tuesday marked the first meeting of the "Intel Insider" group. I know many of the people involved in the creation of the group and also many of those chosen to take part. And I like the calculated risks that Intel is taking by involving some of the top names in the blogosphere and not imposing any restrictions on what we write about. There is some compensation provided for our time. It is mostly in the form of early access to news and also we get to keep some consumer products that contain Intel chips. There is no requirement to write anything about Intel, or the products.

It's an interesting project and I'm always interested in new ventures where we don't yet know what the answers are, where we don't yet know what are the best practices. And as Intel celebrates its 40th anniversary this year, it is a bold step for what has traditionally been a conservative company.

The Intel Insider program seeks to discover some of the best practices in corporate social/new media and in doing so, the results can be shared broadly. There is no restriction on the Intel Insiders sharing the results of the program with others.

What I like about the Intel Insider program is that it's innovative but it's not about technology -- even though Intel's business is all about innovation in technology.

Sean Maloney . . .

Tuesday we got to spend some time with Sean Maloney, Intel's number 2 executive next to CEO Paul Otellini. I've followed Mr Maloney's career for many years, he always gets the most interesting and also some of the toughest jobs at Intel.

Mr Maloney spoke about Intel's decision to pull nearly all of its TV broadcast spend and to go almost completely online. He said it was because Intel could not be sure it was reaching the right people through TV. There will still be some spending on newspaper ads but not much.

Moving online however, is a problem. He said that the fragmentation of the online media and the differences in how that plays out in various countries has created a "fog." It is difficult to know where to spend online and then how best to measure the effectiveness of that spend.

(I will be posting a short video of Mr Maloney discussing this topic as soon as YouTube has processed the material.)

It was very interesting discussing the latest online trends with all the other Intel Insiders, including some of Intel's top communications and marketing people. I'll be sharing some of these discussions in additional posts this week and over the coming months.

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Intel launched its Atom brand to describe its latest microprocessor architecture designed to be used in small computer devices such as pocket PCs and ultra-light notebooks like the Asus EEE.

It's the smallest microprocessor Intel makes with the smallest transistors - 47 million. With its huge 300mm chip fabs, Intel is going to be able to produce a massive number of these chips.

The Intel Atom processor is based on an entirely new microarchitecture designed specifically for small devices and low power, while maintaining the Intel® Core™ 2 Duo instruction set compatibility consumers are accustomed to when using a standard PC and the Internet.

The design also includes support for multiple threads for better performance and increased system responsiveness. All of this on a chip that measures less than 25 mm², making it Intel’s smallest and lowest power processor yet.* Up to 11 Intel Atom processor die -- the tiny slivers of silicon packed with 47 million transistors each -- would fit in an area the size of an American penny.

Intel expects the Atom chips to also be used to make inexpensive notebooks and desktops which it has dubbed "netbooks" and "nettops." These could find markets in developing countries.

The first devices using the Atom microprocessor chips will be out later this year.

Here is a quick video introducing Atom:

http://www.youtube.com/watch?v=GQ2sZk-0UKE

According to Intel, [Nick] Negroponte asked the chipmaker to stop selling its Classmate PC while it was part of the OLPC [one laptop per child], which is currently shipping its XO laptop based on a chip from AMD. The Classmate PC was one of the sources of friction between Negroponte and Intel before they joined forces in July. Negroponte went on 60 Minutes in May and accused Intel of dumping Classmate PCs below cost in order to keep OLPCs out of the hands of needy children.

From CNET: Intel leaves the OLPC after dispute - By Tom Krazit

Foremski's Take: MIT's Mr Negroponte is making a classic mistake of identifying with the hardware instead of with the noble concept of bridging the global digital divide and bringing computing to students in the developing world. If he left it to Intel and the others to figure out the hardware and he concentrated on the evangelizing, which is his strength, the project would progress much faster.

Intel "dumping" laptops is a good thing, it provides low cost laptops. Using Intel and Asus, and others to design and manufacture the motherboards, etc, is a good thing. Create a common set of specs for a OLPC and let the massive PC industry compete and produce the laptops.

You'll get a much better price and you will have several giants helping with the promotion and distribution. Otherwise you have to deal with the difficulty of design, manufacture, and distribution which require economies of scale to be marginally profitable and sustainable.

(Intel is one of the sponsors of Silicon Valley Watcher.)

Technorati Tags: OLPC

Intel is challenging modders (hobbyists who alter the standard PC) to show off their creative skills in building Intel processor-based mods for an online competition. Intel delivers the unrivaled performance and energy efficient processors that modders can then build just about anything from, including an 18-wheeler Mac truck. Get a glimpse at these creations and vote on your favorite one by visiting the Intel Modding Competition Group on Channel Intel. Check out the contest

http://www.intel.com/pressroom/chipshots/chipshots.htm?cid=rss-90004-c1-192263

Now that you can stick a high performance PC in just about anything, I wonder what there is out there that you can't stick a high performance PC into? It would be interesting to see a category of modds that would be unbelievable. Such as a plate of Jello?! You'd certainly need a low-power chip for that one...

Or take advantage of the power dissipation and create a PC that also toasts Pop-Tarts...!

Technorati Tags: puppy

The Intel Developer Forum happens this week in San Francisco. Some of the conference will be livecast through UStream. (Intel is a sponsor of Silicon Valley Watcher.)

My panel is on Tuesday at 3pm:

Social Media: Friend or Foe of the IT Org:

http://blogs.intel.com/technology/2007/09/social_media_friend_or_foe_at.html

Gordon Moore on Stage with NPR's Moira Gunn
http://blogs.intel.com/technology/2007/09/moores_law_speaks_live_to_you.html

And a discussion on Wednesday (9/19 at 1:30 p.m. PT) lead by Intel's Top Minds, a group of Intel Fellows talking about the future of computing.

Technorati Tags: IDF, Gordon Moore

Over on the Intel blog (http://blogs.intel.com/views/ ):

Kirk Skaugen, Intel vice president and Co-General Manager of the Server Products Group at Intel announced information about Intel’s new MP server platform Codenamed ‘Caneland’.

* Caneland is Intel’s new Xeon MP platform. It is composed of the ‘Clarksboro’ chipset and the ‘Tigerton’ processor.

* The earnings call last week saw double-digit growth in servers, both units and revenue. Both year-year and quarter on quarter.

* Quad-core has already ramped with over 1 Million shipped in volume servers

* The Caneland platform is tracking extremely well towards launch his quarter.

The main points of new information that Kirk disclosed in the 6 min video:

[Intel is a sponsor of SVW}

On Wednesday I went to Intel's launch of its latest Centrino chipset for notebooks. Everything, of course, is a lot faster, but what caught my eye was a new technology embedded in the chips which, although aimed squarely at business users, would be a god-send for consumers.

Take a look:

Intel® vPro™ processor technology. IT departments will be able to reliably manage both desktops and notebooks and deal with what plagues them most – security threats, cost of ownership, resource allocation, and asset management – and do so wirelessly.

One of the key innovations designed in Intel Centrino Pro – Intel® Active Management Technology – provides business-class notebook PCs with wireless PC management, protection and remote repair work thereby increasing productivity, IT savings and uptime.

For example, if a virus or other type of malware gets into the notebook, the Intel technology will shut it off from the network, and the IT department is notified, downloads software to get rid of the problem and repair any damaged files. It's all done in a minute or two.

This technique can be used for other things too, installing software across hundreds of clients etc, etc.

At first glance it sounds like many other remote management software applications/utilities that provide similar capabilities, what's new here?

It turns out there is a microcontroller (a separate chip) that creates a wireless back channel to a central location. This back-channel remains unaffected and is used to deliver new software and repairs--even if the notebook is disconnected from its main network and has been completely taken over by hordes of malware!

This Active Management Technology is inside every one of the new Centrino chipsets, but it is only used in business-class notebooks. It allows the notebook vendors to charge corporations a premium. However, it is there in the consumer notebooks too, it is just not turned on.

But it could be turned on with the right software and it could become a platform to deliver repair and maintenance services to millions of consumers! It's potentially a massive business for some future companies. Who will be the first to do this?

Best Buy and its fleet of Geek Squads running out to people's homes to fix their machines might soon become a thing of the past...

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Multitude Of Innovations Boost New Intel–Based Laptops›
NEW YORK and SAN FRANCISCO, May 9, 2007 – Faster processors and chipsets. Great-looking video and graphics. Stronger and faster wireless signals. Better security and manageability. Designed for energy efficiency to enable great battery life.

Intel's PR agency, Burson-Marsteller says that there are some misconceptions in the mainstream media about Intel's new Quad-Core microprocessor. (Intel is a sponsor of SVW).

Samantha Saephan from Burson-Marsteller writes:

Since the launch of the Intel® Quad-Core Xeon® processor and the Intel Core™ 2 Extreme quad-core in November 2006, and the more recent Intel Core 2 Quad processor; research has suggested that there remain some misguided perceptions about performance, price and compatibility. So, in the spirit of the Final Four, and in honor of the 4^th of April, we’re hoping to address what are the four biggest misperceptions about Intel Quad-Core processors.

Misperception #1:

Why pay more for Quad-Core when I don’t yet need that level of performance?

At Intel, you’re getting better performance and better energy efficiency for the same price – Quad-Core offers up to 80%* more performance for the same price as Intel’s dual-core chips. These products deliver immense speed and responsiveness for general purpose servers and workstations and for digital media creation, high-end gaming and other market segments that crave absolute performance. Software developers are also increasingly moving toward per socket licenses which will lower software costs making now the ideal time to skip Dual-Core and upgrade straight to Quad-Core. (* - For detailed system information and performance claim, please visit http://www.intel.com/performance/desktop/extreme/3d_ray_tracing.htm).

Misperception #2:

My systems are already equipped with Dual-Core – now I have to take the time and effort to install Quad-Core?

Advanced technology adoption is not a problem. Quad-Core is easy to install, with drop-in compatibility with Intel’s previous Dual-Core platform. This also makes it easier on data center managers by streamlining the path to server consolidation. In fact, business data centers can achieve significant cost savings/server thanks to the optimal utilization, lower power consumption, and lower software costs of Quad-Core systems.

Misperception #3:

Before using Quad-Core I’d rather wait until software applications can actually take advantage of the performance. Besides, when it comes to some applications, Quad-Core isn’t much better than Dual-Core.

Server software has been threaded for years. But whether it's encoding, rendering, editing, or streaming - or running a variety of applications at once, an innovative Intel processor with four processing cores will deliver more performance and responsiveness. Check out what the press have to say about Quad-Core gaming on Intel processors: Click here http://enthusiast.hardocp.com/article.html?art=MTMwNiwxMCwsaGVudGh1c2lhc3Q=  and here http://www.extremetech.com/article2/0,1697,2107337,00.asp

Also check out Quad-Core gaming at the 2007 Game Developers Conference and World Series of Video Games:

http://www.podtech.net/home/technology/2505/gaming-with-intel-quad-core-processors

http://www.podtech.net/home/technology/1924/intel-gives-gamers-max-power-at-ces

http://www.podtech.net/home/technology/1863/ces-2007-intels-world-series-of-gaming

Misperception #4:

Intel’s Quad-Core is ugly, and far from elegant  

Beauty is in the eye of the beholder. When performance is as great as it is today, customers don’t care about the intricacies of how the cores are connected inside the CPU package. Intel’s solution allowed a much faster time to market and Intel will have shipped more than a million of them before any other x86 competitor has shipped a sizeable volume. Using Intel’s industry-leading 65nm manufacturing technology also allows for smaller die size, better yields and lower cost. This also means better supply. So, it is a careful choice of performance, schedule and cost. Intel is already demonstrating 45nm processors which will further its lead in processor performance, innovation and nanotechnology.

For more information, visit: http://www.intel.com/quad-core/ and http://www.podtech.net/home/technology/1139/idf-preview-quad-core-microprocessors.

Intel's new processor families are on track to deliver faster processors without consuming more power. The Penryn family will be released this year and the Nehalam family is due next year, The New York Times reports.

The chips will have wires as thin as 45 nanometers, a scale at which 2,000 transistors will fit in the width of a human hair. The resulting chips will have as many as 820 million transistors, making it possible for Intel’s designers to add parallel computing, energy management and graphics to the computing engines that are the mainstay of its business.

This news puts Intel - which has been playing catch-up on energy efficiency and parallel computing - ahead of release schedules for AMD and IBM, which have said they'll release 45-nanometer chips in mid-2008.

AMD's Barcelona is due out in late 2007, based on 65-nanometer technology with four cores. On Wednesday, AMD said Intel won't catch up with them until Nehama comes out in '08.

Pat Gelsinger described Intel’s approach as a “tick-tock” strategy in which it would make incremental changes with the Penryn processors and then more sweeping design changes with the Nehalam chips. The Nehalam chips will have as many as eight or more processing cores, as well as the potential for built-in graphics and memory control processing and networking.

Intel is a SVW sponsor.

Intel (an SVW sponsor) has encouraged PC makers to go beyond the beige box for many years. Here is Intel's latest challenge to PC makers, and this time Intel is seeking help from PC users to vote and comment on a variety of PC designs.

You can win $100 in a random drawing by taking part in Intel® Core™ Processor Challenge PC Design People's Choice Awards.

Intel will open a $2.5 billion wafer fabrication plant in China, the first major production facility there, according to the New York Times.

Labeled Fab 68, the new plant will join just seven other plants in the world capable of producing Intel 300mm wafers when it opens in 2010. But Fab 68 will produce only chipsets. Microprocessors themselves will not be produced in China. That's a distinction that won US government approval for the plant.

The move is a huge win for China, which is trying to become a high-tech center.

“The Intel plant is very symbolic,” said Li Ke, a senior analyst at the Semiconductor Industry Research Center in Beijing, a government body. “It is inspiring and will help to expand the production scale of the industry.”

Private industry has been relucant to move to China because of weak protection for intellectual property and the federal government is very concerned about China getting a hold of private sector technology that it can use for military operations. But by the time Intel opens its facility in the northeastern city of Dalian, the company will have opened production lines of at least two generations of more advanced equipment, Intel officials said.

While other companies have assembly facilities in China, Intel stands alone in the size of the investment and the nature of the operation. It's just Intel's third 300mm wafer facility outside the US. The others are in Ireland and Israel.

The judge in the Intel-AMD lawsuit ordered both sides to work with a mediator to figure out how serious Intel's loss of email is, InfoWeek reports.

Intel admitted recently that it had deleted some of the emails AMD had requested in discovery in the case.

The judge gave Intel 30 days to determine whether any of the lost email was relevant to AMD's suit and how important they are. After that, AMD will have two weeks to respond and Intel will have 10 days to answer AMD's response. All of this to be done under the eye of a mediator, who will report to the judge. Intel could face sanctions for the destruction of the email.

Intel in court filings on Monday acknowledged that for three and a half months after AMD filed its suit on June 27, 2005, a small number of employees whose e-mails were considered potential evidence failed to move all messages to their hard drives, which means they would have been purged automatically from Intel's system. In addition, "a few" employees believed erroneously that Intel's IT group was automatically saving their e-mails.

The judge considers the deletion unintentional but AMD is fuming.

"Given the obvious implications to the administration of justice, it is exactly right that Intel must now prepare a full accounting, fashion an effective remedy, and be accountable for the loss of evidence," Thomas M. McCoy, chief administrative officer and executive VP of legal affairs for AMD, said in an e-mailed statement.

If the judge rules against Intel on this discovery issue, Intel could be fined millions of dollars, or the jury could be told to presume the emails were damaging to Intel.

Intel's already delivered 17 million pages of potential evidence and will deliver 30 million more before the trial resumes in May.

Well it would be handy to AMD's lawsuit alleging anticompetitive behavior against Intel, but the chip giant just can't seem to find some of the emails AMD asked to see, the Mercury News reports.

Intel told U.S. District Court Judge Joseph Farnan that it had some "document retention lapses" in the discovery process.

Intel said it has been communicating its problems with AMD and that it is doing everything it can to piece together e-mails that were inadvertently deleted by employees. It said that certain employees failed to move e-mails from their sent boxes to their hard drives, as the company asked them to do, and that they were purged automatically by Intel's e-mail system.

AMD's response? In typical fashion, Intel's archrival says the "lapses" were hardly inadvertant. The Mercury reports AMD wrote in a court filing:

``Intel executives at the highest level failed to receive or to heed instructions essential for the preservation of their records, and Intel and its counsel failed to institute and police a reliable backup system as a fail-safe against human error.''

Intel spokesman Chuck Mulloy said, "We did not intentionally destroy anything. We are attempting to recover everything. We are leaving no stone unturned." He said Intel is spending ``millions'' on looking for e-mails, reconstructing e-mail traffic and creating a new backup system.

Intel said that in July 2005, it sent a notice to hundreds of employees who, based on the complaint, were the most likely to possess relevant documents. It asked those employees to save their sent e-mails and other documents to their hard drives.

But some employees did not comply with all the requests, and some terminated employees' documents may also not have been saved. Mulloy said that from December through last week, Intel has supplied more than 17 million documents to AMD as part of the discovery process.

If the court finds Intel's failure to produce the emails unjustified, it may impose sanctions. In an extreme case, the court could dismiss the case against the party who refuses to disclose. It's more likely the court could impose financial penalties and block Intel from making certain arguments in the trial.

[Intel is an SVW sponsor.]

[UPDATE: Please also see: IBM says Intel not alone in solving 45nm chip roadblock]

People mistake Intel for being a microprocessor manufacturer. That's just an application of what it does best: it knows how to make the world's most advanced chips in massive quantities.

Late last week Intel briefed reporters and analysts on what is likely the most significant breakthrough in chip making since the late 1960s.

Intel said it had discovered materials that would enable it to make the world's tiniest chips in high volumes--and place it years ahead of competitors seeking to do the same.

With the its new materials, Intel is able to make chips with geometries of 45 nanometers, half the size of most leading edge chips at 90nm.

Intel shares a lot of its chip research but it said it will keep these materials secret. If the information leaked out, it would enable competitors to shave years off their R&D efforts and enter lucrative chip markets years earlier.

Quite rightly, Intel is racing to take advantage of this lead. It is building three giant chip fabs which will use its secret process on silicon wafers the size of large dinner plates, 300mm (12 inch) across.

By the end of this year two fabs will be completed and ramping into high volume production, closely followed by a third in Israel, in early 2008--all using this advanced chip making process. This means servers, desktops, and notebooks  will run faster and cooler and will be less expensive.

With more smaller chips being able to be squeezed onto giant silicon wafers Intel will be able to do a combination of several things:

• Existing chip designs will run faster because of shorter distances between transistors.
• Power consumption is reduced because of the smaller size of the chip.
• More transistors can be crammed into the same sized space which means larger memory caches-a performance bottleneck.
• Manufacturing costs are dramatically reduced. It costs about the same to process a silicon wafer in any process. More chips per wafer means more product for the same cost. Intel can choose to lower prices or pocket the productivity increase. (It always lowers prices but it can decide the rate.)

Intel makes microprocessors because they are the most profitable high volume application of its core ability: to make chips cheaper, faster, smaller, and in vast quantities.

All of the above means that rival Advanced Micro Devices is in for a tough time. It won market shares against Intel in server markets because it spotted a trend in low power consuming microprocessors. That was great because it brought Intel into that market and now server buyers have a choice of two very good server chip families.

Mind the Gap

But the gap between the two server product families is set to widen into a chasm. Quite simply, AMD cannot fight it out with Intel on the basis of design.

The chip business is always talking about making chips in smaller sizes because:

• the laws of physics automatically provide faster performance by shrinking the size of chips.
• the laws of economics provide greater profit margins by shrinking the size of chips.

AMD's manufacturing prowess is good but not great. Manufacturing prowess has historically been a highly volatile characteristic at AMD.

Yes, clever designs can boost performance incrementally, but fundamentally, it is the laws of physics that govern every performance characteristic of a chip. And the laws of physics can only be exploited by knowing how to manipulate the material world.

It is through chemistry that we manipulate the material world. Intel co-founder Gordon Moore is a chemist. Andy Grove has a degree in chemical engineering. (BTW, I  have a chemistry degree :-)

Moore was born in San Francisco, California. He received a B.S. degree in Chemistry from the University of California, Berkeley in 1950 and a Ph.D. in Chemistry and Physics from the California Institute of Technology (Caltech) in 1954. (Source: Wikipedia.)

 

Chemistry is something that Intel knows very well. And like an alchemist of yore--it has succeeded in transforming baser materials into gold, lots of it, it is a highly profitable company with margins that sometimes approach those of a software company. 

I think it is safe to say that the chip industry uses more of the periodic table of elements in its production process than any other industry in the world. Because it has to, it has to develop new types of materials in order to make ever smaller chips.

Elements are the fundamental building blocks of the physical world. Elements combine to form material compounds, and each compound has specific physical characteristics.

The chip industry needs materials that can guide electrons at high speeds through an incredibly complex maze of wires just a few atoms wide.

But as everything shrinks in size, materials behave differently. For the chip industry to move to a smaller chip size, 45nm, it needed to find new materials that behave in the correct way.

Finding these materials for 45nm had stumped the industry. It threatened to slow Moore's Law.

Top chip experts had been predicting that 2010 would be the earliest date for a solution to be found. Which means Intel could very well be more than two years ahead...a huge achievement.

That's why Intel's discovery of these materials constitutes what must be the most valuable secret in the world today. Because it dramatically improves the fundamental performance of all silicon chips--the bedrock and building blocks of our current and future worlds.

A two or more year lead into the future is an incredible competitive advantage, imho.

----

Additional info from Intel:

(Intel is a sponsor of SVW) Monday's news that Sun will make Intel Xeon servers and Intel will promote Solaris shocked some observers.

Sun's former CEO Scott McNealy used to say nasty things about Intel's Itanium 64-bit microprocessor, a competitor to Sun's SPARC chip. But that was then, when Sun still thought it had to own the stack.

These days, it is less about the microprocessor and more about the system. Sun realizes that it is in the business of selling data center systems to data centers. And customers are asking for Xeon servers along with AMD, and SPARC servers, that Sun sells. And selling is a good thing.

And the fact that Intel will promote Solaris along with Linux and other operating systems is good for Intel because it encourages sales of servers.

What this alliance shows is that Intel has made a lot of progress in catching up to AMD's lead in low-power consuming servers. Otherwise Sun would not be getting requests from customers for Intel hardware.

What this alliance needs is the addition of Hewlett-Packard, that would worry IBM. Then we'd see a West Coast/East Coast rivalry that could become very interesting to watch.

By Tom Foremski for Silicon Valley Watcher

Intel (an SVW sponsor) is a strong supporter of WiMAX, the wireless broadband technology that works over a distance of several miles compared with the hundred foot or so range of WiFi. WiMAX offers the possibility of bridging the digital divide by bringing down the cost of providing Internet access.

More importantly, WiMAX could be a way of opening up the "last mile" into consumers' homes, currently guarded by the cable and telco companies. These companies have been bundling Internet access with other services, which raises the costs for many customers interested in just Internet access.

The Intel WiMAX Connection 2300 chipset design was demonstrated during Executive Vice President and Chief Sales and Marketing Officer Sean Maloney's keynote at the 3G World Congress and Mobility Marketplace in Hong Kong.

Maloney showed an Intel® Centrino® Duo mobile technology-based laptop with mobile WiMAX (IEEE 802.16e-2005), Wi-Fi (IEEE 802.11n), and high-speed downlink packet access (HSDPA) 3G capabilities successfully accessing the Internet at broadband speeds over a mobile WiMAX network.

Link to Intel Demonstrates Its First Mobile WiMAX Baseband Chip

This WiMAX chipset could also help boost Intel's revenues. The company's Centrino WiFi chipset for notebook computers was hugely successful and helped support record profit margins for many quarters.

Integrating radio capabilities into chips is not an easy task because analog and digital circuits respond in different ways to the CMOS production process.

This is interesting:

For the first time, Intel incorporated multiple input/multiple output (MIMO) functionality into the baseband chip to enhance the signal quality and throughput of wireless bandwidth. The baseband chip also employs the same software for Intel's WiMAX and Wi-Fi solutions to help ensure unified management for connectivity. Over-the-air provisioning supports easy configuration and enables consumer activation of services, shifting the traditional hands on service provider business model to a direct activation one based purely on consumer purchases of mobile devices.

Making things easier for consumers is key, it appears that they will be able to choose services without needing to know how to configure their notebooks, or be tied to any one service provider. I wonder how the cable and telco companies will respond, especially since WiMAX would enable inexpensive cell phone capabilities.

WiMAX would offer far faster Internet connection speeds, which would encourage new types of applications and services, which would require more Intel based infrastructure equipment investments. WiMAX on consumer notebooks would pull through a potential revenue bonanza for Intel.

Opening up the "last mile" would also help to establish Internet neutrality--vital in creating a fair competitive arena for startups with innovative services and technologies. Clearly, there is quite a lot riding on this Intel product.

But, there is a wait:

Intel plans to focus on validating and testing the product, with plans to sample both card and module forms beginning in late 2007.

Quad Core is key to Intel's bid to revive profits and growth. PodTech's Jason Lopez interviewed Stephen Smith, head of Intel's desktop and platform operations:

http://www.podtech.net/home/technology/1139/idf-preview-quad-core-microprocessors

By Tom Foremski for Silicon Valley Watcher

Intel (a SVW sponsor) Tuesday announced an advanced chip design that has 80 cores and can perform at a trillion floating point operations per second.

This would make possible inexpensive supercomputers that could model complex events such as global warming, designing safer cars, and be used in drug discovery.

Prototypes of the chip were shown by Paul Otellini during his keynote speech that opened the Intel Developer Forum conference in San Francisco. The chips are about five years away from commercial introduction.

Intel also said that a quad-core server microprocessor would be introduced in November and followed by a desktop PC version early next year.

The announcements reflect Intel's bid to regain some lost ground to rival Advanced Micro Devices. Intel has focused strongly on its chip design and manufacturing prowess to produce chips that use much less electric power.

Large computer data centers are running out of electric power. In order to expand computing facilities, computer systems that use less electric power are in high demand.

To boost sales of PCs in the home Intel announced it would pay  up to $1m in prizes to designers and manufacturers of "sexy" PCs. The Intel Core Processor Challenge aims to encourage PC makers to go beyond the "beige box."

Intel is trying to establish its Viiv PC platform in the living room as the heart of a digital entertainment system for the entire home. And a stylish format would help sales.

Eric Kim, vice president and general manager, Intel’s Digital Home Group said:

Consumers today make home PC purchase decisions based on more than just price and features; they also consider the size, shape and style. Ultimately we want to see more stylish and smaller PCs that have the performance and power efficiency thanks to Intel Core 2 Duo processors, as well as the essential multimedia capabilities that Intel Viiv technology delivers. . .

Related links:

Intel To Pay Up To $1 Million Bounty For Sexy, Small, Stylish PCs

Intel Develops Tera-Scale Research Chips ›

Intel CEO: Silicon Advances Usher in New Era of Energy Efficient Performance ›

Intel, DIRECTV Poised to Connect PCs and TVs in U.S.

Intel, Omnicom Media Group Announce Collaboration to Bring Internet-Delivered Ads to TVs Through Intel® Viiv™ Technology

SVW stories:

SVW Top Chat: Henri Richard sales chief at Advanced Micro Devices

The Empire Strikes Back - Sean Maloney leads Intel's push to win back markets

Intel (an SVW sponsor) is preparing to cut as many as 10,000 jobs, News.com is reporting.

The job cut is likely to weigh particularly heavily on marketing staff. Intel studies comparing its own staffing levels to competitors' concluded that the ratio of marketing personnel to salespeople was too large, the sources said.

The cuts are part of a huge internal review embarked on last April. Intel apparently concluded that its marketing staff was bloated compared to other companies'. The review has already resulted in the sell-off of Intel's telecom and XScale chip businesses, the layoff of 1,000 managers and the reshuffling of top management.

Intel (an SVW sponsor) announces its  latest Xeon microprocessor, codenamed Tulsa Tuesday. It is an impressive chip and CNET's News.com has a good overview:

Link to Intel readies 'Tulsa' Xeon debut | CNET News.com

Next week I'll be interviewing Henri Richard, AMD's Chief Sales and Marketing Officer.

AMD's response to Tulsa (fair point on the last point):

- AMD firmly believes that customers are entitled to both high performance and low power consumption;  the competition's   4P offerings on the market really only offer one .
- AMD has a product strategy while the competition has products (ie- platform stability, single common architecture, and customer centric innovation, vs. 13 different platforms, little investment protection, and increasing complexity).
- Three things buyers look for in their servers: Performance, Performance-per-watt and performance per watt per dollar. The recent claims from the competition specific to their new 4P offering do not address all three.
- With all the talk about new microarchitectures being introduced in the market, it's interesting to note that the latest 4P processors introduced by the competition are based on an antiquated NetBurst architecture that will soon be "end of lifed."

Intel's recent launch of its Core 2 Duo microprocessors seems to have contributed to a big inventory buildup of older Intel microprocessors and chipsets as customers wait for the new chips. According to Rosemary Farrell, analyst at iSuppli, the market research company, there is a massive chip inventory glut of $2bn, and most of it belongs to Intel.

Intel’s excess inventories of these parts carried over from the first quarter. However, the problem worsened in the second quarter when Intel instituted price cuts to clear out lingering inventory in advance of its new product launches. This triggered a price war with rival Advanced Micro Devices Inc. (AMD).

“With more reductions expected from Intel and AMD, customers have been placing smaller, more-frequent orders than normal in order to delay volume buys until they can get the best pricing,” Farrell said. “Because of this, inventory will remain in Intel and AMD’s hands for a longer period than usual.”

For Intel, this means additional weight is being added to its already-bloated stockpiles. Inventory is expected to begin to decline in the third quarter as sales of its new microprocessors and chipsets take off. However, the company’s surplus will linger into 2007, iSuppli predicts.

Many PC customers are likely waiting for computers with the Core microprocessors, offering higher performance and less power consumption. The back-to-school season should be interesting to watch. Everytime chip prices fall, it always boosts markets because computing devices become more affordable. This is how the digital divide will be chipped away.

Thursday was a very important day for Intel (a sponsor of SVW) as it introduced its Core 2 Duo family of microprocessors, representing the most important product launch since its Pentium launch 13 years ago.

"The empire strikes back," was how Nathan Brookwood, microprocessor analyst at Insight64 termed it. And that's an excellent comment on what this launch means to Intel, the world's largest chipmaker.

The Core 2 Duo launch is more than just a new microprocessor family; it represents Intel's determination to return to its core capabilities after embarrassing missed product deadlines, less than successful forays into other businesses, and an obsessive need to regain market share lost to rival Advanced Micro Devices.

It is also a return to a culture formed from a rigorous engineering discipline that doesn't tolerate missed deadlines, or *any* loss of market share--no matter how small.

To further underline the importance of this event, just days before the launch Intel appointed its most effective and aggressive senior executive, Sean Maloney to lead its global sales and marketing.

. . .

As Intel chairman Craig Barrett looked on from the front row, CEO Paul Otellini strode the stage and reported that over the past couple of years Intel's engineering teams have consistently met all their deadlines on time, and sometimes ahead of schedule. This includes the new Core family, which will form the foundation of Intel's business for the rest of the decade and beyond.

But getting to this point was not easy, it required a complete overhaul of its microprocessor designs in order to make low electric power consuming chips operating at higher performance levels. These two goals are extremely difficult to achieve with traditional microprocessor designs. Intel had to develop innovative technologies, making the chips smarter about power conservation, while providing higher performance through the use of multiple processor cores.

During this time, it was not easy watching rival AMD make significant inroads into its markets, with its Opteron family and other microprocessors.

The significance of Thursday's launch was further underlined by its location at Intel's HQ in the heart of Silicon Valley, in huge tent filled with nearly 300 journalists and analysts.

Sean Maloney, the freshly appointed senior VP of global sales and marketing, demonstrated the capabilities of the chip family, and promised further advances in lower power consumption, increased performance, and new types of applications for the digital living room.

. . .

Over the past 24 years Mr Maloney has earned a reputation as Intel's top troubleshooter. He is the one that Intel relies upon to tackle some of its most challenging business problems.

Mr Maloney used to head Intel's UK operations and then became technical assistant to CEO and chairman Andrew Grove. From 1992 to 1995 he worked side-by-side with Intel's legendary top executive, learning all aspects of the business. This is how Intel grooms executives destined for its senior ranks.

Through a series of senior positions Mr Maloney quickly became known as one of Intel's most effective and aggressive managers, tackling some of the company's most difficult jobs such as rebuilding its troubled communications chip group.

Again, Mr Maloney has been handed one of the company's most challenging jobs: reigniting sales and growth for what insiders call "Intel 3.0," the next big phase of Intel's business strategy. Intel 3.0 represents the third reinvention of the company.

Very few people remember that Intel started off as "the memory chip company," then it became "the microprocessor company," and now it is set on a new course to become "the platform company."

But Intel is like a supertanker in that it takes a while for it to set up a new course; when it does, it becomes an extremely aggressive competitor.

AMD, located just a stones throw away from Intel's HQ, has done well to exploit changes in microprocessor markets at Intel's expense. Now it faces the full might of a refocused and reenergized Intel determined to win back any lost market share--and then some.

Yet AMD's response is puzzling. Earlier this week it announced plans to acquire Canadian graphics chip maker ATI Technologies in a $5.4bn deal. This is not the time to be distracted by a huge merger--unless AMD's management is looking to ATI as a life raft.

In fact, a life raft might be the best way to view this deal if you consider that AMD has to develop its own multi-core chip family, develop global sales channels, *and* invest billions of dollars in building new chip fabs, which, by the way, includes mastering a new manufacturing process at 65nm. Each one of these are extremely challenging and risky endeavors.

I cannot see how AMD can continue to gain market share and profit at Intel's expense. It is up against a competitor that just announced a record number of 550 PC/notebook design wins; and 200 server design wins for its new microprocessors. Intel has already successfully made the transition to 65nm production; plus it has one of the industry's most capable managers, Sean Maloney, leading its global sales push. This is the Empire Strikes Back--with a vengeance.

- - -

Coming up: Sean Maloney talks to SVW on net neutrality. (I grabbed a few minutes with him for a chat before his presentation.)

Intel, (an SVW sponsor) today introduced its latest Itanium microprocessors as it continues to fight for market share against IBM's Power and Sun Microsystems Sparc 64-bit microprocessors.


Intel said:

Previously codenamed "Montecito," the new processors are designed for the most sophisticated high-end computing platforms in the world. They double the performance and lower energy requirements, improving performance per watt by 2.5 times compared to existing, single-core versions.

The Itanium family is used in high-end computing platforms that do a lot of number crunching, such as modelling weather systems, product design, and drug discovery. The chips have impressive performance for such applications and Intel says the new versions continue to lead in industry benchmark tests.

The Itanium chip designs are very different from server or PC microprocessors because they have to deal with moving and processing large amounts of numeric data. This high-end computing market requires very large and complex chips. The latest Itanium chips are Intel's most complex with more than 1.7bn transistors.

Pat Gelsinger, senior VP, introduced the chips at a press event in San Francisco. He announced new customers and said that 70 of the world's 100 largest companies now use Itanium systems.

Intel has had to invest a lot of resources in creating the infrastructure of applications, developers, and tools needed to support the chip. These are different from the rest of Intel's microprocessors which are based on X86 technologies.

It is the increase in applications specially designed for Itanium systems that is key to boosting Itanium system sales. Intel says more Itanium applications were added in the first six months of 2006 than were available in 2003.

Itanium was developed with partner Hewlett-Packard, which provided Intel with designs and technologies developed for large IT systems. Itanium gradually replaced HP's PA RISC microprocessor based systems. HP continues to be Itanium's largest customer and it says it has strong orders for the systems based on the chi[p

Intel has come under criticism from Wall Street analysts and investors about its Itanium business because it has been slow to build markets. But Intel says it is committed to the chip and it has a roadmap that stretches beyond 2010 to assure potential customers that it won't pull the plug on the product family.

The Itanium group has also been spared from cuts in Intel's operations as the world's largest chipmaker seeks to cut costs by $1bn. This is part of a reorganization of Intel that focuses the company on its core microprocessor business.

The Itanium grew out of Intel's strategy to apply the economics of the PC industry to the corporate data center. By using standard components, Itanium systems should be less expensive than high-end systems from IBM and Sun.

But cost of hardware is less important than the cost of porting applications to Itanium, and the cost of operating the systems. With more Itanium applications now available and lower operating costs through features such as Intel's virtualization technology, Itanium systems should now be in their best position to attack competing Power and Sparc system markets.
...
Please see SVW: Intel + HP 's data center push - saving power and saving labor

More info on Itanium.

Intel's (Intel is an SVW sponsor] sale of its cell phone and handheld computer chip business to Marvell Technology Group for $600M, announced earlier today, represents a change in its strategy to apply the economics of the PC industry to cell phones, smart phones, and communications equipment markets.

In the mid to late 1990s, Craig Barrett, the former CEO of Intel, led efforts to expand the company's business into the fast growing cell phone and communications equipment markets. Through a series of large acquisitions totaling more than $11bn Intel built one of the world's largest communications chip businesses to become the leading provider of Internet infrastructure components.

Mr Barrett and his team saw that PC markets were maturing, and that server markets would become part of a global interconnected communications infrastructure. Intel's strategy was to extend its pole position--to providing silicon for the entire global digital communications infrastructure; and everything connected to it.

Intel wanted to provide silicon for every type of edge device, such as pocket computers, cell phones, PDAs, cameras, notebooks, PCs. And also provide the essential chips for servers and communications equipment that create the connecting foundation of the Internet.

Intel knows that investing during downturns is a wise strategy--that's what it does during the boom and bust cycles of the chip industry. And despite the dotcom crash, growth of the dotcom economy would return, and along with it the massive infrastructure investments by the telcos and others. Intel knows we are still at the beginning stages of the Internet and that the real growth is still to come.

But timing is everything in the tech industry where being too early can be the same as being wrong. Nobody would argue with Intel's long-term view of the future and its strategy, but managing a huge company on Wall Street expectations based on quarterly performance makes it doubly difficult to tune strategy to short-term market changes.

Also, Intel's comms business strategy was based on the assumption that it could apply the same economics that worked well in the PC industry. If it could produce powerful, off-the-shelf components that could be easily adapted to many different types of communications products, it would quickly win customers.

Intel expected that comms companies would ditch their custom chip efforts because they would be able to get to market faster using off-the-shelf Intel components, as the PC industry had done.

Intel (an SVW sponsor) got a good turn out from the media Monday morning when it presented a roadmap on how it would stay ahead of rival Advanced Micro Devices in low power consuming high-performance server chips.

The chips are strategic to Intel (INTC) keeping its dominance in server chips as data centers turn to computing systems that use less electric power--the single most limiting factor to expanding computing facilities. AMD's Opteron has managed to win support because it use less electric power and offers good performance.

Monday also marked the first day that Intel is shipping its first Opteron-killer product, the 5100 Series Xeon microprocessor.

Tom Kilroy, Intel vice president presented a broad message that Intel is going to maintain a power and performance lead over Opteron because it can make the chips smaller; it has fast buses and other system technologies such as virtualization; and it has long established relationships with thousands of vendors, developers, customers, etc.

There was lots of discussion about Intel's lead in 25 key benchmarks, lots of technical discussion about buses, memory controllers and shared caches etc. There were also a lot of questions on the subject of benchmarks, making apples to apples comparisons, etc.

One important point was that the socket for the new 5100 Xeon chips would remain the same through to the end of 2009. This means faster chips can be inserted without having to swap out all the other components or buy completely new systems.

The new Xeons use 40 per cent less power yet offer about a 3 times performance increase compared with one-year ago Xeons. But it is not just the microprocessor it is other system components and technologies that are also important in reducing power consumption. Intel said it is working with many other third-party companies to help reduce overall power consumption.

SVW Take: AMD will have trouble maintaining its share of the server markets simply because of Intel's massive manufacturing prowess which is a full generation and more, ahead of AMD. Intel can also leverage long established business relationships in enterprise vendor markets while AMD is still very new to this space. Intel also has a large ecosystem of software tools and support that it offers customers.

The subject of benchmarks and making a fair comparison against Opteron chips is a subject that many journalists have focused on lately. Nathan Brookwood, head analyst at Insight64 was advocating a type of cook-off between Intel and AMD with both optimizing their systems to their fullest degree.

Benchmarks however, are not the way data center managers typically make purchasing decisions. They usually run their own tests because of the different designs,implementations, and application loads that servers carry.

Greg Brandeau, VP at Pixar, the computer animation studio said he preferred plugging a system into the wall and using a commonly found wattage meter to measure electric power consumption. He said that Pixar uses Opteron systems and he would continue using them alongside the latest Xeon servers as an easy comparison. He praised Intel's software development tools which he said helped optimize Pixar's graphics software.

Enterprises are traditionally conservative and Intel offers a safe bet that it will be able to deliver on its multi-year roadmap and leverage its long standing industry relationships to continue to produce highly competitive server systems.

AMD is a newcomer to enterprise hardware markets and it will have to work hard to build the relationships and trust that it needs to do compete against Intel. AMD could try to cut prices to gain market share but it is a dangerous game to play against Intel, which can pump out more chips per wafer. And since chip manufacturing costs are constant, more chips per wafer means a lower manufacturing cost for Intel. Plus, AMD has to expand its chip manufacturing fabs, and move production from 90nm to 65nm - a tricky process but one that Intel has already achieved.

AMD will maintain a position in server markets because IT customers like choice and they know it will keep Intel on its toes. But the question becomes will AMD's slice of the server markets be large enough to pay for the design and manufacturing that goes with it.

_ _ _

Intel's benchmark site: http://www.intelstartyourengines.com/

AMD Opteron site

From SVW:
Intel + HP 's data center push - saving power and saving labor

AMD Tech Day: Forecasts continued gains against Intel

Intel (an SVW sponsor) today will introduce its Opteron-killer Dual Core Xeon server chips which use less electric power and provide more performance in key benchmarks.

Advanced Micro Devices' Opteron servers have become popular because they use less electric power than equivalent competing microprocessors. This allows computer companies to pack more computing power into the same amount of space.

The low-power data center is a top goal of enterprise vendors and that's why Advanced Micro Device's Opteron has done well. Data centers are being limited by the amount of electric power their local utility can offer, and many are operating at their top limits. Some cannot install more computing power because they don't have the electric power to run the extra equipment.

To expand computing capacity, data centers are turning to low power consuming servers, the fastest growing segment of the server market. More computing power can be installed per kilowatt of energy, or customers can choose cooler systems that need less cooling and create substantial savings on electric power. Large data centers can spend tens of millions of dollars on annual electric power costs.

Intel (INTC) will discuss details about its Core Xeon server chips at a press event in San Francisco Monday morning. They represent the first of a family of new chip designs that are optimized for low-power consumption. They are also built in smaller geometries which further cuts power consumption.

Intel estimates its new chips use 35 per cent less electric power and provide as 80 per cent performance boost against comparable prior chips.

I recently met with Lisa Graff, general manager of server platforms at Intel. She said that the benchmarks of the new chips will be much better than for Opteron. There is an Intel site offering performance benchmarks at http://www.intelstartyourengines.com/

It can be difficult to directly compare AMD and Intel server chips because of different server designs and the application loads on the servers. But it is the overall power savings of such systems, rather than small differences between the two competing brands, that will drive sales. The vendors that have low power servers on the market first will benefit the most.

Intel and AMD are rapidly expanding production of their server chips. The competition between the two will become about which company can meet market demand. Making the chips is difficult and requires high yields per wafer in order to to be profitable. Intel has the edge in manufacturing technologies but AMD has made big progress in raising production yields per wafer over the past five years.

Google, the search engine company, is among the customers for such servers. It operates some of the largest data centers in the world and it is very concerned with electric power costs. It is building a huge data center in Oregon in an area where there is cheap hydroelectric power. Places where there are aluminum smelters--which require larges quantities of electric power to refine the metal--are sites that are becoming increasingly attractive to Google and others because they indicate places where there are cheap local electric power resources.

Intel (an SVW sponsor) today provided a sneak peak of its forthcoming ultra-low power Core Duo notebook microprocessor which consumes 0.75 watts of power, which would make it the lowest median average in the industry. Dell and HP will use it in a family of slim notebook computers coming out later this summer.

It was part of a series of announcements made by Intel (INTC) at the Computex trade show in Taipei, Taiwan by Intel's top sales chief Anand Chandrasekher. It also included a number of Intel technologies that are focused on home/living room applications. Excerpts from Intel's press release:

By Tom Foremski for SiliconValleyWatcher

Intel, the world's largest semiconductor company, on Monday awarded massive public relations contracts to just three companies. It is part of a large rebranding effort set in motion by Intel CEO Paul Otellini, who was appointed just nine-months ago.

SVW sources close to Intel and within the PR industry said that Burson-Marsteller, Hill and Knowlton and Ogilvy Public Relations Worldwide were the winners of a long and highly competitive bidding process that engaged almost every large PR company.

"There were dozens of senior executives at all the large PR companies involved in trying to win this contract. Millions of dollars have been spent on winning this deal," said one source.

The plum contract is believed to be one of the largest ever awarded by a Silicon Valley company and quite possibly the largest within the tech industry.