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Intel Fights for Its Future
- cyberjunkie 9y agoIntel has reasons to be worried. They missed several buses, trains and ships and other opportunities. Servers still appear to be secure but with threats from ARM solutions, and AMD. Windows 7 and Windows 10 have been pretty efficient operating systems. That's great for Microsoft but not Intel. With identical system requirements, it means there's very little reason for most people to upgrade hardware. Me, a supposed high-end PC user am still running a 3rd generation Core i5 processor with no urgent need for upgrading in the near future. Graphics cards are still a once every 2-3 year upgrade for PC games.
- m_mueller 9y agoalso threats from NVIDIA in high-throughput demanding markets (machine learning, crypto mining, HPC). Essentially Intel hasn't been able establish new markets and their existing ones are being chipped away.
- dizzystar 9y agoI can't speak for Win10, but back in the 7 days, you'd be batty to buy an AMD PC. They had a high flake value and I'm not really sure if the average PC user ever changed their mind on that. It seems to me that most people would do a bit of research, see that Intel is still destroying AMD on speed tests, or they go to Best Buy and see a load of Intel stickers. The sales person will rightly or wrongly tell the customer that Intel is better, and so on. The main point is that mot people are not power users or knowledgeable about computers. That's why you can read reviews online about how Dell is horrible because "it catches viruses."
- swiley 9y ago>Windows 7 and Windows 10 have been pretty efficient operating systems. All of my friends who run it must be using it wrong because that is not my experience.
- ternaryoperator 9y agoThis article makes it seem that being a major player in mobile is the only way Intel could survive. Mobile is a decelerating market, while cloud and servers, where Intel has a huge lead is an expanding market and profitable. In 2017, Intel's revenue hit an all-time high, as it did the year before, and its stock is an all time high. This is not a company "fighting for its future."
- katastic 9y agoThe only thing that sells is scandal.
- vectorEQ 9y agoagree, even if they sold nothing atall in the smart phone market, all the smart phones of the world still need servers to service the users needs.. and they practically all run on intel or ibm cpus.
- ttul 9y agoYes. I must say I chuckled a bit when I saw the headline. Intel is still churning out 63% gross margins. On semiconductors. That is exceptional. Intel is not fighting for its life by any stretch of the imagination.
- geezerjay 9y agoMy take is that the analysis refers to Intel's long-term prospects, not today's or yesterdays's revenue. These reports serve as a foundation to guide decisions on future long-term investments.
- melling 9y agoIntel is fine as long as ARM doesn’t compete in their core markets. Then it’s a sudden and violent change. I guess you don’t see ARM attaining parity with x86?
- imtringued 9y agoApple is the only manufacturer that actually produces competitive processors. Qualcomm is lagging behind x86 by at least a factor 2 compared to laptop chips and by factor 6 compared to desktop chips. On top of that the arm laptops that have been announced were significantly more expensive than an equivalent x86 laptop and the x86 emulation isn't good enough to count on it.
- deleted 9y ago[deleted]
- krapht 9y agoI think this article misses the point: Intel has nothing to gain by entering the commodity smartphone processor market. The margins are slim, and therefore doesn't make good use of Intel's advantage in semiconductor fabrication. Serial performance is important in processors, and as long as Intel is king in this area, they will have a home in server racks and workstations. I keep hearing about how cheap arrays of ARM processors will take over the world, but I'll believe the easy parallel programming unicorn has arrived when I see it. It seems more likely to me that when this is the case, a move to GPUs, FPGAs, or custom accelerator card would make more sense.
- Athas 9y agoIn the short run, you are correct. However, by looking at history, it seems that the high-end chip manufacturers always end up being replaced by the low-end manufacturers, as the focus on cheap, small, low-power designs end up providing various strategic advantages (and raw revenue for product development). That's how Intel replaced the various RISC manufacturers in the 90s. Of course, the field is young enough that this has only happened two or three times, so it may just be a coincidence. Still, I like the thought of ARM chips replacing Intel in ten years, and twenty years later ARM being replaced by whoever currently makes the chips for those musical greeting cards.
- sah2ed 9y agoExactly -- the key thing is the historical cost structures of the high-end makers makes low-end chip making highly unattractive which was why it was easy for Paul Otellini to say no to Apple to make chips for the iPhone. In the end, low-power chipmakers like ARM have no where else to go but up -- they can slowly move up-market and over time, enjoy the same high margins but at much lower costs relative similar to entrenched players like Intel.
- product50 9y agoSo why are they considering acquiring Broadcom?
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- mankash666 9y agoBoth deals [Intel, broadcom] , [Qualcomm, broadcom] are unlikely to pass regulatory muster. Further, as many have noted, Intel doesn't have a seat at the mobile table. It just wants to thwart a [Qualcomm, Broadcom] combine that's likely to aim at Intel's jugular - the cloud/server market
- snuxoll 9y agoI hope any merger or purchase of Broadcom is thoroughly investigated, considering how much of the datacenter market and even consumer networking is reliant on them there's a lot of ways the entire industry could get messed up by the purchasing company. Between switch ASIC's like the Trident II, RAID controllers and SAS HBA's, 802.11 chips, DOCSIS modem chips, optics, etc. they are almost everywhere even if you don't see them.
- kev009 9y agoThey are also showing signs of fatigue in the data center space which carries high margins. The underhanded I/O game they are playing is both alienating customers and providing a big opportunity for AMD, IBM, and Arm.
- matheusmoreira 9y ago>The underhanded I/O game they are playing Can you please elaborate on this?
- slededit 9y agoThey are extremely stingy on the PCIe lane counts to limit the usefulness of GPU coprocessors. They've also pretty much ignored PCIe v4.
- imtringued 9y agoAMD already pushed ARM out of the server market. Low cost, high performance, high IO and x86 compatibility. ARM's only advantage compared to AMD is low standby power consumption.
- Rambunctious 9y agoWhy can't Intel acquire Qualcomm instead of Broadcom?
- make3 9y agoit likely would never pass with the regulatory agencies I suppose
- baybal2 9y agoBarely insightful. The rumor of Intel buying Broadcomm, ... is most likely being perpetuated by Broadcomm itself
- chmaynard 9y agoGassée has his own reality distortion field, of course. His punditry is entirely focused on closed-source, proprietary technology and the big corporations that own it. He never writes about RISC-V or Linux, perhaps because they aren't generating big sums of cash and therefore aren't worthy of his attention.
- PyComfy 9y agoIntel shall definitively be worried https://blog.cloudflare.com/arm-takes-wing/ https://blog.cloudflare.com/arm-takes-wing/
- narrator 9y agoSpeaking of Intel failing to innovate, has anyone seen Intel's 10nm process? Canon Lake was supposed to be out in 2016 and it has now been pushed back to mid-2018. There was a super brief update about it at CES [1]. Makes one wonder if the future is not arriving on-time as previously expected. [1] https://www.anandtech.com/show/12271/intel-mentions-10nm-briefly https://www.anandtech.com/show/12271/intel-mentions-10nm-bri...
- deepnotderp 9y ago10nm is facing acute yield issues, rumoured to be because of the use of cobalt.
- narrator 9y agoI am surprised at the under-reporting of this issue. We are literally on the brink of a serious chip technology stagnation which could cause a dead stop to moore's law and very few people are concerned.
- seanmcdirmid 9y agoWhen I graduated from UW in the late 90s, Intel was the place to work for most CE and many CS majors (as well as tons of EEs). Those glory days are long gone it seems.
- joeblau 9y ago> By declining Steve Jobs’ proposal to make the original iPhone CPU in 2005, Intel missed a huge opportunity. I'm really intrigued by stories of missed opportunities. Certain companies have all of the power then make a minor miscalculation on the future of technology. Does anyone have similar personal experiences that echo this type of missed opportunity deal?
- erikb 9y agoI think this is a misinterpretation. If you are the market leader and have huge profits you can enter such a market at any time. It just costs more and more the stabler the market becomes, which in turn of course also decreases the risks and costs of development. The art is finding the sweet spot to enter, and beating the competition that's already in the market and tries to keep you out.
- mseebach 9y ago> Certain companies have all of the power then make a minor miscalculation on the future of technology It happens all the time, in matters big and small. A company takes a bet on something, it fails, and afterwards people (even on the inside) are scratching their heads and thinking "how did we ever think that was going to work?". Most of the time, nobody outside the company hears about it. When companies are powerful, their power is generally concentrated in a very narrow domain. Stray just a little outside that domain, and they're just as clueless as anyone else (although perhaps with deeper pockets).
- goingbananas 9y agoThis is a very nice compilation: https://www.amazon.com/Search-Stupidity-Twenty-Marketing-Disasters/dp/1590597214 https://www.amazon.com/Search-Stupidity-Twenty-Marketing-Dis...
- erikb 9y agoOften the solution is a stalemate until a profitable opportunity arises. So, no surprises here. Interesting to see that such a giant can really start shaking so badly by losing one of its sources of profit. I think even if the whole desktop market dies Intel will still make more money than most companies. Sure, maybe they need to shrink 80%, but 20% is far from a small company.
- muyuu 9y agoNot a single company in the field has a 100% guaranteed future. Even Microsoft, completely dominating in the 90s, is now second fiddle to the likes of Google and has their future jeopardised by the emergence of the cloud and mobile platforms. Having said that, Intel are going nowhere overnight.
- erikb 9y agoAnd even Google feels a little shaky these days, not really knowing what the next big thing could be for them after search+ads. Their mobile and their cloud business are both small compared (if the data didn't change over the last 1-2 years, haven't looked it up for some time).
- dbcooper 9y agoA key point missed in this discussion is that Intel needs high volume through its fabs to pay for their high capital investment requirements. If it doesn't have the consumer CPU volumes (notebook, desktop, mobile) then production costs for server chips will be much higher, and it won't have those nice margins.
- jarym 9y agoIntel also taking its eye off the ball as far as desktop and laptop CPUs go. CoffeeLake should be renamed CoffeeBreak given the years it’s been delayed! Perfect storm if AMD continue to pile on pressure and ARM licensees start making inroads into servers.
- Symmetry 9y agoThe big problem is that Intel's 10 nm is very late, rumor says having to do with their decision to move to using cobalt more aggressively than other other fabs. Intel's traditional advantage in their silicon process is substantially eroded which is making things much easier for their competition.
- mtgx 9y agoI think at least part of this reason is driven by NSA/DoJ, just like Microsoft's Skype acquisition was. Also, why is Krzanich still CEO? He's made terrible decision after terrible decision. Buying Broadcom now reminds me a lot of Ballmer wanting to buy Yahoo for $40 billion. In hindsight that looks like a terrible deal, doesn't it? I think if Intel buys Broadcom, this will look the same in 10 years. Intel has strong conflicts of interest against other non-x86 chip divisions, which would be Broadcom, I'm sure it's the same with Altera, too. In a few years they'll regret buying FPGAs, too. The "synergy" is a lie.
- bogomipz 9y agoThe author states: >"If the dispute is settled, Intel loses its wireless modems deal with Apple. No mobile CPUs + no modems = nothing of substance." Aren't nearly all processors in mobile devices a SoC these days? Isn't the "wireless modem" just an LTE radio on the same SoC that has an 802.11 radio for wifi? I'm not understanding how these would be separate in a device like an iPhone.
- senatorobama 9y agoThis thread is funny because no one really knows what Broadcom does.
- hugs 9y agoYears ago, during a fund-raising tour of Silicon Valley VC firms for my previous company, we also pitched Intel Capital (their in-house VC arm). Their feedback to our pitch was that our SaaS service was "too compute intensive" and therefore they passed..... Intel thought we used too many CPUs?!..... All these years later, I'm still in disbelief. I do realize that VCs often are uncomfortable giving the real reason they're passing, but "too many CPUs" was a first for me. (And my company is still around and making more than $25MM/year, thank you very much.)
- wslh 9y agoIntel Capital is another branch and not known as a leading VC firm. I don't think you can connect their achievements with Intel itself.
- hugs 9y agoAnother possibility is that they were indeed, correct -- we did use many CPUs to perform the work, even though it is the nature of the work (running end-to-end tests on browsers, simulators, and devices).
- Permit 9y agoIn a similar vein, we pitched Microsoft Ventures on a developer tool we were building. One of their chief concerns was that we were targeting C# developers. (Why not JS? Is C# even that popular?) This helped drill home the intuition that large companies are not a single entity, but an amalgamation of different groups and individuals each with a potentially different motivation.
- dmichulke 9y agoMaybe the intention of the fund was to diversify - i.e., hedge their huge exposure to the CPU market by investing into totally different things, i.e., not you!
- hugs 9y agoQuite possible!
- PaulHoule 9y agoThis article misses that Intel has really missed the boat when it comes to GPUs; the company that it needs to beat is NVIDIA which actually is producing a rapidly improving product. Intel integrated GPUs have no place at all in deep learning. They are perfectly good for emulating the 2001 Gamecube and playing classics like Doom and Quake, but they have a bad enough reputation among gamers that if and when they do come out with a discrete card they will have to brand it something other than Intel.
- zdfjkhiuj 9y agoThe company they need to beat is AMD. AMD's integrated GPU's are thoroughly trouncing Intel's and are good enough for light gaming. Their weak integrated graphics hurt their core business of CPU sales. They certainly want to compete in the discrete GPU space, but I think they should be much more scared of losing CPU market share.
- huslage 9y agoThere are always missed opportunities in any business. Intel did not capture the mobile market, so what? There is no evidence that ARM-based servers from Qualcomm, or anyone else for that matter, will somehow make a dent in Intel's leadership in that space in the short to mid term. Not to mention that Intel has significantly diversified its product line and will continue to do so. There is not a world where there will be one processor manufacturer. We will see multiple manufacturers on multiple architectures for as long as things continue to progress. Intel may have a short-term existential threat, but that threat is minimal.
- chmaynard 9y agoI think you missed the point. It's fine to disagree, but your comments indicate that you don't understand or appreciate the magnitude of Intel's hubris and the inevitable blunder that followed. Intel literally invented the microprocessor. The fact that they let this opportunity slip through their fingers is astonishing.
- stcredzero 9y agoHas Intel experienced some kind of strategic brain drain in the past 5 years? I remember a professor telling me in the late 90's about how RISC wasn't going to dominate the future, because Intel had a roadmap going well into the 2000's specifying how they were going to stay ahead. Now, it looks like AMD has the strategic upper hand. https://www.youtube.com/watch?v=ucMQermB9wQ https://www.youtube.com/watch?v=ucMQermB9wQ