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Intel doesn't know how to be a foundry, Tim Cook reportedly said in 2011
- raverbashing 2y agoWell, he's not wrong Subdivisions that only work for one customer grow around all their idiosyncrasies and it's hard to adapt later Actually putting the design work into something you can work with is hard work
- duxup 2y agoI’ve seen that with startups. I’ve seen that with established very successful companies that try to sell to new customers. You try to do something different, and every business process and management member is there to stop you because of what they learned previously … when working with a different customer or market. The Steve Jobs story about resistance to developing a mouse in house is a good example.
- dlivingston 2y agoWhat's the Steve Jobs mouse story?
- duxup 2y agoThis is the interview I'm thinking of: https://www.youtube.com/watch?v=s4Cz49MLh4o https://www.youtube.com/watch?v=s4Cz49MLh4o The general topic applies to what I mentioned but even just the specific mouse story is at this point in the video: https://youtu.be/s4Cz49MLh4o?t=90 https://youtu.be/s4Cz49MLh4o?t=90 Folks who operate in a certain context / process or such and just can't imagine doing any differently and will stop you.
- zdragnar 2y agoI've seen it kill more than one company. The company is so bent out of shape for that one special customer, that as soon as the relationship is over or isn't as profitable as they'd hoped, they aren't able to actually support any other customers.
- tyleo 2y agoIf you haven’t listened to it already, Acquired remastered their TSMC episode. You can find that here https://www.acquired.fm/episodes/tsmc-remastered https://www.acquired.fm/episodes/tsmc-remastered If you are interested in getting more context on TSMC, this is a great place to start.
- davepeck 2y agoAnd to be clear, they also flew to Taiwan and interviewed Morris in English for what appears to be the first time in over 15 years: https://www.acquired.fm/episodes/tsmc-founder-morris-chang https://www.acquired.fm/episodes/tsmc-founder-morris-chang A tiny bit of this (excellent!) interview led to the story we're all commenting on.
- talldayo 2y agoSure they do. They just don't have any capacity for producing the chip density that Apple demands. It's like showing up to a motorcycle factory and complaining that they don't know how to manufacture cars. If America wanted EULV fabrication, it had to be organized and funded by the state. American fabs already made their business decision.
- CharlesW 2y ago> They just don't have any capacity for producing the chip density that Apple demands. TFA says that the "Intel just does not know how to be a foundry" quote is from 2011 (14 years ago), and referred to Intel's lack of a "customer-centric mindset" rather than specific manufacturing capabilities.
- wtallis 2y agoThe article is talking about Intel's capabilities almost 15 years ago. EUVL is not part of the conversation. This was when Intel was bringing up their first FinFET process. It's pretty widely known and documented that Intel at that time was in a horrible position to be a foundry for outside designers, especially ones that wanted to be able to design for more than one foundry.
- scrlk 2y ago> If America wanted EULV fabrication, it had to be organized and funded by the state. The DoE funded initial research in to EUV via the national labs and EUV LLC back in the 90s. The IP was licenced to ASML, whilst Canon and Nikon (the leaders in lithography at the time) were blocked.
- Tostino 2y agoPeople in government in the 90s made a good call, and we haven't done anything since then to ensure it actually played out, until the post WW2 world order was already extremely unstable. We have had multiple rounds of "why are we paying for any of this?" In our federal government since then.
- 01100011 2y agoIn 2011. Seems like that should be in the title.
- behringer 2y ago> "When the customer asks a lot of things, we have learned to respond to every request," Chang said. "Some of them were crazy, some of them were irrational, [but] we respond to each request courteously. […] Intel has never done that, I knew a lot of customers of Intel's here in Taiwan and all [of them] wished that there were another supplier." Companies just don't get it, that customer service is almost always the most important aspect of the company. The customer will put up with a lot of bullshit if communication is rock solid. Handing off your customer service to agents that don't have reading comprehension, who don't have any authority, or who are completely non-understanding is going to hurt business. And I'm not talking about customer service that can write flully emails thanking and apologizing and butt kissing, I'm talking about good customer service is when the agent understands the request, takes it seriously, runs it up the flag pole if needed, and can act on it.
- duxup 2y agoI have to manage my personal urge to reject or overreact with customers all the time. Customers do come up with a bonkers ideas / UI that's horrendous or just unworkable internal logic. And yet if I sit with them and we talk about "what can we do to solve the problem / enhance the product / get your goal done" I find they often come up with some good ideas and are happy to discard their initial madness.
- ChrisMarshallNY 2y agoThat's "Beans and Noses": https://archive.uie.com/brainsparks/2011/07/08/beans-and-noses/ https://archive.uie.com/brainsparks/2011/07/08/beans-and-nos...
- duxup 2y agoThat was great, thanks.
- georgeburdell 2y ago(2011). And Cook was right. I worked at Intel for a few years during that decade and the foundry efforts were just not set up for success; in my area, they hired a bunch of new people, put up a firewall between us internal folks and the foundry folks, then without any guidance turned them loose. I was not even allowed to talk to them to troubleshoot equipment issues. They also got all of the equipment that we’d rejected for various reasons like poor process control, so they were newbies with worse equipment trying to start up a new group without help beyond what vendors would provide (for $$$) I have no insight into the customer facing side
- michaeljx 2y agointeresting perspective. Care to elaborate a bit more? Where you in the design department? Why did they put up chinese walls? Was it to enable the foundry to have other customers other than Intel designs? Why did you have similar type of equipment? Were you also manufacturing chipsets? If so, why didn't they expand your division to become a foundry?
- scrlk 2y agoThere's a good video from Asianometry (Lessons from Intel's First Foundry): https://www.youtube.com/watch?v=-Y9LWYmVQu0 https://www.youtube.com/watch?v=-Y9LWYmVQu0 If you're an Intel foundry customer, you don't want your design or IP leaking across to Intel's product team, who might be a competitor.
- petra 2y agoBut the IP is already "compiled", or if you want to isolate even further, separate just the mask making process. What could be learned from masks?
- B1FF_PSUVM 2y ago> What could be learned from masks That's like asking what could you learn from building plans ...
- AcerbicZero 2y ago[flagged]
- mullingitover 2y agoYou only need to look at the history of Apple with and without Jobs, with and without Cook, to see how replaceable Jobs was and how irreplaceable Cook has been. Apple’s original crash happened while Jobs was in charge, which was why they fired him in the first place. Jobs’ return brought Cook, and since the second Jobs exit the company has done better than ever.
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- scarface_74 2y agoCooks biggest blind spot is not playing nice with regulators and not being willing to give an inch. I think Jobs would have been worse. Could you actually see Jobs ever being a trophy for Trump and biting his tongue like Cook does?
- duxup 2y agoSteve reportedly told Tim to be himself and not try to be Steve.
- twoodfin 2y agoGiven what we know about Apple and Cook, this seems like at least a modestly foolish story for Chang to have told. Apple’s senior leadership has always for better or worse had long memories and held even longer grudges. And they don’t like partners to speak for them, or create the impression—even if accurate—that Apple has a dependency on a single supplier.
- greedo 2y agoThat's true when Apple has alternative suppliers, ie graphic cards when nVidia blabs before a presentation. But who is going to replace TSMC? Sure someone will in 15-20 years, but for now...
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- Etheryte 2y agoYou could've said the same about Intel at one point, but here we are years later.
- johnnyanmac 2y ago2011 article, so GP's timeline fits.
- zodiakzz 2y agoIt's not a 2011 article. The alleged statement by Tim was made in 2011.
- caycep 2y agothey have used Samsung before...maybe with middling results but if push came to shove, Samsung's fabs have been the backup I think.
- mushufasa 2y agoChang is 93 years old. He can say whatever he wants.
- epistasis 2y agoParticularly relevant with the 100% tariffs that Trump is going to try to ram through: https://www.tomshardware.com/tech-industry/semiconductors/taiwans-economy-ministry-responds-to-trumps-threat-of-up-to-100-percent-tariffs-on-chips https://www.tomshardware.com/tech-industry/semiconductors/ta...
- samtheprogram 2y agoThey’re already running a plant in Arizona, and I heard it’s going really well. It won’t matter.
- wtallis 2y agoThe plant in Arizona is deliberately not equipped to produce current-gen chips.
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- th0ma5 2y agoThat is in an international economic zone and would be subject to tariffs as well as for supplies.
- WillPostForFood 2y agoThe point of the foreign trade zone is no tariffs, avoid customs. And the point of the tariff is to get plants built in the US, so tariffing them would make no sense.
- th0ma5 2y agoAnd yet!
- bryanlarsen 2y agoDid you forget the sarcasm flag?
- ksec 2y ago>TSMC founder says Tim Cook told him in 2011 that Intel did not know how to be a foundry That is the Original Title. It could be edited as "Tim Cook told TSMC in 2011 that Intel did not know how to be a foundry" - That would still have been accurate with the date on. Now the title has been editorialised, and meant or imply something else. Like most of the comments are already suggesting.
- insane_dreamer 2y agoJust think where Intel would be today if they had truly leaned in and made the necessary changes to supply the iPhone chips.
- wmf 2y agoTim Cook would have negotiated away their profit margins?
- scarface_74 2y agoAnd how is that different than what is happening now? https://www.intc.com/news-events/press-releases/detail/1716/intel-reports-third-quarter-2024-financial-results https://www.intc.com/news-events/press-releases/detail/1716/... > Third-quarter GAAP earnings (loss) per share (EPS) attributable to Intel was $(3.88); non-GAAP EPS attributable to Intel was $(0.46).
- xmodem 2y agoYeah, like they've done to TSMC over the past decade. (/s)
- foota 2y agoWouldn't they still be behind on the chip technology curve? Seems like this would hurt Apple, not dramatically help Intel.
- wtallis 2y agoIf Intel Foundry starting in 2011 had a non-trivial external customer base, Intel management would not have been so easily able to ignore the signs of trouble with their 10nm process and remain in denial. Their wake-up call would have been Apple jumping ship after a year or so, instead of Intel wasting several years re-releasing Skylake without even considering porting their newer CPU architecture to be built on the process that actually worked. The first 10nm chip Intel actually got out the door (in tiny quantities) had the entire GPU disabled because their high-density transistor library was broken. That's exactly what Apple would have been using for most or all of an Intel-fabbed iPad chip, so Intel would have not been able to maintain the fiction that their 10nm process was mostly or even somewhat healthy.
- BeetleB 2y agoThis is back in 2011, when Intel was first flirting with the Foundry business, and has little bearing to their efforts today. That first effort mostly died. The goal wasn't to become a major player like Samsung/TSMC, but to ensure factories don't sit idle (i.e. just fill in the gaps with small customers). Intel products would get priority. The current vision is very different: It's to somewhat separate the fabs and Intel's products, and the end goal is that Intel Products will just be another Foundry customer. Whether they can achieve this is another story.
- wtallis 2y agoArguably, Intel has already achieved the most important part of the Intel Foundry strategy: letting the CPU designers target whatever fab is best for their needs. Getting most of the consumer CPU moved to TSMC for Meteor Lake a year ago and the rest of it moved to TSMC last fall is hugely important. Intel Foundry cannot count on having a big customer, and the product line isn't forced to stick exclusively with failing fabs.
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- jonathaneunice 2y agoThis situation has been and maybe always will be common. Those who view themselves as integrated manufacturers of *products* often cannot equally package, deliver, and sell their component *services*. No matter how good those services are at delivering the end product—and sometimes they are completely world-class or genuinely unique—they're almost always highly designed, refined, and evolved over years to map to the specific end products and their one business. They are NOT designed, refined, or evolved to be reusable, retargetable capabilities for all interested parties. By any rights, the major systems manufacturers of the 2000s—Cisco, Dell, HP, IBM, Sun Microsystems—should have had an enormous leg up in becoming the planetary scale, "red shift" cloud computing providers of today. Let's kick major operating environment vendors of that era in for good measure—Microsoft, Red Hat, VMware. Maybe even Oracle and SAP. They had the technical capabilities, the economies of scale, the vendor ecosystems, the customer relationships, the financial might. "Permission to win." Yet, only a few have made it. Microsoft has made the transition with Azure, but it's been a long hard pull. Maybe a few participation trophies for IBM and Oracle. But as a group, where are they, cloud-wise? Not too impressive that AWS and Google and others that had no classic "required assets" or "permission to win" have wiped them off the playing field or kicked them deep into the "others" bin. You can call that classic innovator's dilemma, and there's a lot to that. It's insanely, unfathomably hard to disrupt your own current successful business for new delivery models and aspirations. But there's something else as well: services and products are different beasts. They take different mindsets, expectations, business models, and metrics. All the best to Intel in becoming that new thing, a service provider. But it not just a side gig or slight extension. It's a radically different thing, and it's no wonder the highly successful product Intel of 2011 wasn't also a good service provider.
- gsibble 2y agoCounter-Point: GCP and AWS came out of product focused companies that effectively converted to providing the services they used internally.
- ethbr1 2y agoI'd never really thought about "How did hyperscale cloud providers become cloud providers?" And it's surprisingly distinct. AWS: Bezos API memo -> internal infra services that were external ready -> polishing and exposing those one-by-one GCP: Internal architectural/technical excellence -> new org that attempted to productize v2.0 of those services Azure: Believe it was mostly ground-up build as a new org/product? (No idea where Oracle cloud came from, internally)
- npalli 2y agoLess of a technical reason than the fact that TSMC was willing to go farther in accommodating Apple's demand (which is right). Also, this is Morris Chang relaying, so not totally unbiased. The implication was that Intel lacked the customer-centric mindset required for a foundry business. Unlike TSMC, which tailors its process technologies to meet customer needs, Intel was used to designing and producing its own chips and struggled to adapt to servicing external clients. By contrast, Apple valued TSMC's ability to listen and respond to specific demands, something Intel historically did not do.
- timewizard 2y ago"Intel makes more than enough money that they don't have to cater any part of their design to external partners and historically have done very little of this type of work. Our use case was simply not on their radar." On the other hand I can appreciate that Intel chips are more of a known quantity than the various ARM designs that are floating around out there.
- scarface_74 2y agoAnd just a note, Intel is losing money and still as of the third quarter of last year paying a dividend while complaining about cash flow
- kmeisthax 2y agoSo, Intel's fault was being focused on selling you the whole widget and telling you what you wanted, instead of something that met your needs. Just like Apple, IMO - the whole "product vision" thing is great when it's about figuring out how to sell a good smartphone and terrible when it's selling iPads with desktop chips in them that can't do any useful professional work outside of drawing.