Disposing of 'Intel Inside'

[tw]

Intel may be in serious trouble. It’s just not obvious on the spread sheets and will not be apparent for four and more years later when work performed this year starts appearing on those spread sheets. Symptoms start when you look at its top manager. Paul S. Otellini is the first non-engineer to run the company. Otellini studied economics in U of San Francisco and then an MBA from University of California at Berkeley. Many new employees include software developers, sociologists, ethnographers, even doctors to help develop products. He lays particular emphasis on marketing expertise because he thinks the only way Intel can succeed in new markets is by communicating more clearly what the technology can do for customers. This is the same mentality that Lucent used to even undermine the Bell Labs. Obvious application only undermined and destroyed the genius in Bell Labs. Otellini is talking the same way having no experience where the work gets done.

Instead of remaining focused on PCs and other processor related functions, Otellini is changing Intel to play a key technological role in a half-dozen fields, including consumer electronics, wireless communications, and health care. And rather than just microprocessors, he wants Intel to create all kinds of chips, as well as software, and then meld them together into what he calls "platforms."

Intel got where it is by doing what it did productively AND nurturing others to do same or compatible functions into a system. For example, computer chip sets, modems, video cards, etc are all contributors to making Intel innovative and productive. Intel defined a strategic objective, then designed and controlled the heart of a system design that all others contribute to. Some of those successes are USB, AGP video, PCI bus, power supply standards, video standards, Ethernet, wireless computing, most of the mobile computer functions, and the so many ways of powering and powering down a system.

So Otellini will take all this work from others to make Intel a better company? Somehow compete against its own partners?

Some of Intel's problems were already created by Barrett - the previous boss who followed a legendary Andy Grove. But symptoms of a company in even deeper trouble are demonstrated by how Otellini will solve these problems. They intend to blow up Intel's branding; a fifth-best-known brand worldwide. Intel will "clear out the cobwebs" and kill off many Grove-era creations. Intel Inside? The Pentium brand? The widely recognized dropped "e" in Intel's corporate logo? All will be eliminated - as if redesigning fenders on a GM car will fix the problems inside. But remember, Otellini is an MBA and does not come from where the work gets done. His solutions will only be what he can see - not where problems really exist. Somehow rebranding Intel will solve everything?

Intel's problems started with Pentium 4 when the architecture got so large that a chip could not be produced reasonably. The solution was to optimize compilers so that Pentium 4 would remain faster. Intel's genius was in processing and manufacturing that others could not do equal or better. Smaller transistors, less heat, faster switching times, introduction of the most advanced new process technologies and materials. This combined with partners who were some of this nation's best corporations - Microsoft, Dell, Compaq, HP, the so many video and BIOS manufacturers, modem designers, chipset designers, memory manufacturers, and networking companies. All partnered with or had their designs defined by Intel.

Well Intel started to hit a brick wall. Its advanced manufacturing abilities were confronting limits of transistors. Its architects had not kept up their microarchitecture. And its management under Craig Barrett apparently were too busy looking at spread sheets to, instead, see a technology barrier approaching.

Suddenly last year, Intel canceled all new chip designs because heat and other problems made the Pentium too difficult. Suddenly the new Intel architecture was created due to an ignored problem - and created in an emergency solution - a dual core chip design. This being ironic because Dr Craig Barrett's background is material science with over 40 papers in the science. He should have seen it coming.

Well Intel recently hyped a whole new microarchitecture to fix the weakest part of a Pentium design. Will it solve Intel's recent loss of one title - 'fastest server processor' - to AMD?

So Intel must address its product line - technically. Instead Otellini wants to diversity the company into doing what its so many product partners accomplish. Somehow he thinks the GM corporate strategy will save Intel. Somehow putting Intel in direct competition with Texas Instruments and other so innovative companies will make Intel better? The guy must be an MBA in the tradition of Carly Fiorina - who received a same early analysis from this author for same reasons. She too hyped the word innovation while doing the classic bean counter shuffle.

This is not good for Intel, Intel consumers, or America. It reminds me of how AT&T decided all other computer manufacturers were incompetent and that AT&T would become the new power in computing. AT&T was also destroyed by MBA management with the same new philosophies. Their soulution - buy and destroy NCR.

AMD - a German processor manufacturer - is quietly eating away at most of Intel's product line. Intel's only promising processor markets are in its Pentium M series - mobile computing. Even its non-volatile memory business may be in trouble without a breakthrough new technology product.

[Torrere]

AMD is based in Sunnydale, California. California is not now, nor has it ever been a part of Germany.

Intel's problems did not start with the Pentium 4. The design of the Pentium 4 was motivated by marketing: because consumers judged CPUs by clock speeds, they sacrificed speed and power for high clock speeds. The early 1.5 GHz Pentiums 4s were, if I recall correctly, slower than the 1.0 GHz Pentium 3s.

[jaguar]

Yea the netburst arch sucked balls, everyone knows that but the newest chips are looking might fine, centrino was very nice, the core duo and upcoming quad ones that will be in the new power macs are looking like very nice procs indeed. Demos of the latest chips I saw were spanking AMD. AMD is also now a generation behind in fabs and Intel will have it's next gen out before AMD does.

[tw]

Originally Posted by Torrere

AMD is based in Sunnydale, California. California is not now, nor has it ever been a part of Germany.

I recall AMD (before making processors) was a TX company - one of the little companies in the shadow of TI. But AMDs processors are now designed and manufactured in Dresden Germany. This is also where AMD is building their newest fab. For obvious reasons, AMD does not much discuss where these processors are designed and manufactured. Yes AMD also has fabs throughout the US. But...

Intel's problems did not start with the Pentium 4. The design of the Pentium 4 was motivated by marketing: because consumers judged CPUs by clock speeds, ...

That is not the story of Pentium 4. Architects designed a chip choke full of ideas including (if I remember) a preprocessor that would rearrange op-codes. As the chip was designed and taped out, it was clear that the IC would be about 3 or 4 times too large. Reasons behind the expression 'too large' are too numerous to list here.

Therefore Pentium 4 architect solution was to remove as many functions as possible. One operation that suffered from a 'diet' were SI/DI operations. To make this 'Jenny Craig' processor work fast enough, compilers had to arrange code in proper order.

Now spin doctors entered. A Pentium 4 executing non-optimized code would run quite slow. For example, SI/DI functions would drag that processor into long wait states if code was not properly ordered by a compiler.

At that time, AMD processors were still significantly slower but were selling at discount prices to attract customers. After the K-5 fiasco, AMD was finally making a marketable processor. But AMD was not making profits since their still inferior processor had to sell at discount prices. K-6 was still a dog. But the first dog that demonstrated AMD could finally design a processor.

To discover reality, always start with the technology - the details. So many instead jump on Rush Limbaugh type hype - never first ask for those technical details. Never challenge those who promote MBA school type reasons. I have been through this same 'myths verses reality' discussion on '8080/8085 verse Z-80', '80x86 verses 68000', and 'Pentium verses PowerPC' nonsense. In each case, the hype about marketing or other myths were proven false. The accurate answer was always found in technical details and who was top management.

For example, so many would praise the 68000 because writing code was easier. IOW they were myopic. All those 'flexible' op codes also meant hardware was more difficult to manufacture and design. As a result, the 680x0 (68050?) self destructed because the 68000 architecture was that poor. But you could not tell that to programmers who typically had no science education AND who did not see the entire picture.

Same reasoning explains why architecture of a Pentium 4 design was its weakness. A weakness that was masked by so many other and superior aspects within Intel Corporation. A weakness all but recently acknowledged by Intel with their recently announced new cores - said to have 'superior' microarchitectures. Without those details, then one really does not know what is and is not better. Those details suggest serious problems for Intel - made worse by a new top executive who talks too much like Carly Fiorina.

[tw]

Originally Posted by jaguar

Demos of the latest chips I saw were spanking AMD. AMD is also now a generation behind in fabs and Intel will have it's next gen out before AMD does.

Those demos were a new Intel design verses an existing AMD product. Then AMD announced their new processors. Whereas Intel is already doing 65 nm chips, AMD is still testing that technology. Again, a crown jewel in the Intel product - superior material processing designs resulting in faster transistors.

AMD is currently winning at the upper end (server) market. Their HyperTransport has been successful and may even eliminate the North bridge. HyperTransport is on the board signalling at gigahertz - which should raise your eyebrow IF you appreciate the details.

Too many recent Intel designs - which once rarely happened - are missing design deadlines. Mistakes have been found too late in the design process. Intel equivalent to HyperTransport, called Coherent Scalable Transport, has been delayed for both Pentium and Itanium architectures. This by itself means little. But lately Intel had been making too many such mistakes - far more than the Intel that was run by Grove, Moore, and (forgot his name).

These details today are what cause spread sheet to reflect those realities four and ten years later.

Cray has recently assessed AMD and Intel products. Their bottom line is that the long term projections from both companies means AMD wins. It suggests what is happening in upper end product markets. But then Cray has never been a successful company once the MBAs decided to use GaAs technology rather than innovate - massive parallel architectures. For example, Cray lost $200million in 2004. They have repeatedly been close to bankruptcy because MBAs took over the company. Cray is playing catchup even to their own employee, Stephen Chen, who proposed a massively parallel architecture (that MBAs rejected) and who is now running a Cray competitor - Galactic Computing. What Cray is calling a major innovation - blade processors - well, if you have a grasp of details, then you appreciate why that may be more hype and less innovation.

IOW when Cray choses AMD, well, one must also look at who might be doing the choosing - another detail.

[jaguar]

Which new procs did AMD announce? I'm not aware of any AMD proc coming out before them. HT is nice but it's not like AMD developed it alone and the CSI (Scalable Coherent Interface) delay was the fault of the ill-fated Intel India operation which has now been closed. CSI also has some notable advantages over HT and latency is way, way lower.

In a nearer timeframe Merom and Conroe are shaping up nicely and as it stands AMD has crap all in the mobile arena which is becoming larger and larger. Intel still has 80% of the market. AMD has done well to get where they are but I expect it's going to be neck and neck on peformance over the next couple of years.

Put it another way, noone can deliver chips like Intel with the exception of maybe IBM, Apple would not have picked Intel if they didn't see a damn strong line of processors coming up.

[tw]

Originally Posted by jaguar

Which new procs did AMD announce?

I only heard a report of the AMD presentation which, for me, would be too soon for reports with details.

... AMD has crap all in the mobile arena which is becoming larger and larger. ... Put it another way, noone can deliver chips like Intel.

Intel's move into the Pentium M line is probably their most productive move. Intel was losing that market to other 'clone' Pentium manufacturers. This is why a major company wants smaller competitors. That success by the competition got Intel's attention in a market Intel had mostly ignored. That revelation created the Intel Pentium M line. Technology from that processor line is being used in other Intel products as Intel 'discovered' they had a new "unexpected?" energy problem.

But what troubles me have been weak architecture designs in their upper end processors, their failure to make Itanium competitive, their complete avoidance for a 64 bit Pentium, that Intel was surprised by a sudden heat increase and an unexpected need for multi-cores, the Rambus memory fiasco, CSI delays, failures to dominate in the wireless markets (Wi-Fi and Wi-Max), failures to break into the mobile phone business which could be the disruptive technology to replace mobile computing, Intel’s failure to remain competitive in the non-volatile memory market (although rumors persist that Intel may reenter that market with a whole new technology), and numerous other misses.

Especially worrying is that Intel appears to not have a long term strategic plan as it did 10+ years ago that resulted in North/South Bridge, AGP, PCI integration, USB, flat memory models, the many powerdown methods, and simpler peripherals by putting more compression/decompression functions within the processor. Where is the new strategic objective for hardware? It appears Intel has none; therefore shotgunning innovation rather than integrating it in a fashion that made Intel so successful.

Intel's success that included going smaller faster - going directly to 65 nm technology and making it work, its ability to finally close a deal with Apple - Intel has been repeatedly talking and building an Apple with Intel chips, and their success with Pentium M all are achievements. And of course, nobody can mass produce so many more advanced chips so quickly like Intel. That manufacturing and material processing ability has always been an Intel crown jewel which is why previous posts about strained silicon, ovonyx unified memory, high K-dielectrics, and spintronics always include references to Intel.

But AMD keeps eating more of Intel's pie - which Zilog Z-80, Motorola 68000, IBM Power PC, and Transmeta, etc all promised and never could even come close to delivering. AMD is the first competitor to remain and even grow competitive to Intel. Not because AMD is doing things better. I fear a severe management weakness starting to take hold in Intel. This because the new top man talks too much like Carly Fiorina and John Young; both caused bad times in HP.

[tw]

Intel to Undergo Broad Restructuring
... Intel Corp. is planning a broad restructuring that will focus on every aspect of the chip maker's operations, Chief Executive Paul Otellini said Thursday. ...

The restructuring comes as Intel has seriously stumbled in recent months. A host of new products from Advanced Micro Devices Inc. has allowed Intel's biggest competitor in PC microprocessors to steal away market share. ...

Building on the success of Intel's Centrino, a bundle of chips and software for mobile computers, Intel earlier this year introduced Viiv, a chip package designed for media PCs. Earlier this week Otellini unveiled a new bundle called vPro, which initially will be aimed at business desktops, but eventually will include mobile machines as well. VPro is slated for release in the third quarter.

VPro sounds like the new dual core processor design when management finally conceded and terminated nearly finished single core processor designs.

[jaguar]

VPro might be the public name for Merom/Crusoe/Woodcrest, the release window fits perfectly, as does the release order (merom last).

[mbpark]

VPro is the marketing name for their built-in hypervisor, which will allow you to run multiple OSes at once.

AMD has the same technology, code-named Pacifica.

In other words, these chips will have the same functionality IBM's old mainframes did in the 1970's.

Part of the plan, apparently, is to run one OS as the base, trusted OS, and then run Windows or Linux on top of that. This, combined with EFI, has big-brotherish potential.

However, for those of us who want to run multiple OSes, this means that you'll be able to run Xen, VmWare, Parallels, or your choice of software and run multiple operating environments at native speed.

Who is to say that Microsoft won't take something small and stable, such as Singularity (their research OS), and use that as the root OS to prevent you from doing things?

Heck, if I were MS, I'd have something booting up in EFI that's non-legacy such as Singularity or a custom build of OpenBSD (they already ship large chunks of it in UNIX Services for Windows), have that OS simulate a BIOS, and then load Vista on top of that. "Instant" circumvention of people attempting to do things via the HW by BIOS traps. And, AMD and Intel support it.

Otherwise, on Intel vs. AMD here....Intel does have one good division which designed the Pentium M, and may have worked on its successors, which will come out this year. Intel Israel may have saved their butts by reworking an already existing architecture (the P6) instead of starting from scratch (the P4).

I may be a little off on this, but remember the last time this happened? Intel designed a new chip from scratch, and after cutting their losses, released a new chip which was based off of the old one in some way.

Oh yeah, it happened twice . We call them the i432 and i960. The i432 or whatever it was called was eclipsed by the 386, and the i960 was eclipsed by the 486 and Pentium.

Intel's biggest failure has been the Itanium. After billions upon billions of dollars, and hiring many of the best compiler people in the business, they've only succeeded in hitting the niche markets. It is also not x86 compatible, and apparently is incredibly hard to program for. The only Itaniums I have heard of run HP-UX or Linux.

AMD, on the other hand, took an existing design, worked with it to include HyperTransport links on the chip, and made something which was less expensive to manufacture and had a lower cost for SW development by supporting already-existing tools and environments.

Intel tried to go with the bigger and faster route. AMD just made it incredibly attractive to have an Opteron.

[tw]

According to EE Times, vPro and Viiv are limited functions that don't transport well across the product line. This so different from a productive Intel that once created a roadmap for PC advancement (DIB) that included new video standards, PCI bus (that includes PnP abilities), North/South bridge with memory interface, USB, hardware functions that made sleep and hibernate possible, and even banged Sony Toshiba heads together so violently as to create a single DVD standard.

An industry analyst says, "vPro is not being well-received by the Pc channel partners as it adds undue cost and complexity to the enterprise market". This would be consistent with so many changes announced by Otellini that sound more like rebranding and no technical innovation. These are characteristics also found in AT&T when it started a 20 year self maculating process to cost control itself to death.

Intel's problems first became apparent when AMD introduced HyperTransport - and Intel did not even have anything in planning and eventually came out with 3GIO.

Intel remained in denial about NAND non-volatile memory. It remained with NOR technology and is said to be losing money. Recently it teamed with Micron to play catchup in the NAND market - too late. But Intel is now said to be separating memory production from processor production - step one in selling off its memory business. If true, then all this promise from Intel for OVC memory may have been mythical.

One shocking hint that Intel management does not get it. Intel intends to create a new architecture every two years instead of every four. Reminds me of another American IC manufacturer who decreed a new IC every week would make a market leader. Therefore they introduced numerous ICs that disappeared - nobody wanted them. But on spread sheets analysis, this was a perfect solution. How could the accountants have gotten it wrong? Maybe they had no idea what innovation was?

Intel's problem is not that others 'catch-up' with Intel architectures within four years. The problem is that Intel's architects since and including the P4 had pathetic designs. Since the limits of transistors (gates that are only 3 atoms thick) have created a brick wall, the Intel crown jewel (semiconductor manufacturing advances) have little room to keep advancing. This brick wall and a superior architecture is why AMD with less manufacturing abilities have now created superior high end processors.

Yes, Intel's crown jewel does mean Intel can do more with less power / less heat. But this crown jewel by itself no longer can make Intels faster than AMDs.

IOW a 'new architecture every two years' says Intel's new MBA boss does not get it. He does not understand where the problem lies and instead implements an MBA 'numbers' solution. This myopia also explains why Intel had to cancel some almost completed single core processor designs - because management finally listened to technical people too late. Intel's architecture blindly stuck to a single core design when they long ago should have realized a problem created by architectures that just were not competitive.

And then there is this blind allegiance to Itanium long after they should have had a 64 bit Pentium to fall back on. Readers of Tracey Kidder's "Soul of a New Machine" will appreciate how major this paragraph is.

Finally even long time Intel user, Dell, has finally conceded to AMD processors. Whereas Intel still has a low power Centrino dominance, Intel has lost its title in server application - high end processors - 32 bit processors that don't have the speed, no 64 bit Pentium, and the flawed Itanium that long ago would be canceled if not protected by HP.

BTW, one symptom demonstrates why Intel lost that title - Hyper Transport created by AMD and used by numerous other processor and sysetm companies such as Transmeta, Apple Computer, Cisco, PMC Sierra, Sun Microsystems, Broadcom, and NVIDIA. AMD is now doing what many years ago is what Intel did.

[mbpark]

TW,

The "Yamhill" 64-bit Pentiums are out there. AMD was first with them on the market, however, as Intel tried to artificially push the Itanium with HP. They had the 64-bit Pentium long before, but MBAs wanted the Itanium chip. As of now, I hardly hear about an Itanium implementation that isn't either HP-UX or Linux. Vendors are having massive trouble moving their code from PA-RISC to Itanium, and unless there's a major performance increase, they don't.

vPro is for desktop and server chips, and is a response to try and get Linux to do what VMWare does already. Xen, the next generation of VMWare, and other virtualization products build off of it. AMD, however, has their own implementation, and vendors are going to have to support both.

The Opteron is eating Intel's server lunch. It costs less than the Xeon or Itanium, and does more. Intel put their head in the sand. AMD has some innovation issues as well (the next generation of chips, K9 or K10), but they're taking market share because they are delivering what customers want at low prices.

[tw]

Intel has a long history of promoting products that fail. It comes with the industry that Intel is in. Some of the many processor lines attempted and failed include i860 series, i960, 80x9x series, and DSP processors. In each case, Intel management stuck with them until it was clear the line was not going to be successful. Two lines that did succeed were the 80x86 series and the Harvard architecture that ended with the roundly successful 8051.

Intel also dabbled in processors for cell phone. The mScale series may be a new successful market. Their attempts in MIPs were not.

Other product lines pioneered or marketed in the Intel line were bubble memory, dynamic RAM, static RAM, non-volatile NOR memory, modem chipsets, Ethernet technology, Expanded/Extended memory standards, USB technology, and various software packages. Intel created standards for plugNplay, PCI Bus, AGP video standards, and so many other concepts that were Intel product and industry standards. Intel literally created standards for all type semiconductor memory. Many of these businesses by themselves would have been primary and successful product lines in other companies. Any yet these same successes have only been secondary businesses in Intel.

So what, besides Pentium and mScale, is part of Intel's future? Strangely, Intel's new (alternative) product lines don't even appear to be consistent with Intel's past history. I just don't know of any new products that could be as successful as the 8051 line, USB standards, or non-volatile memory. Previously when a product line was maturing, then Intel sold off that product line while it was still marketable. They probably should have been selling off the memory business long ago OR developed alternative for the failing NOR EEPROM business. Instead, Intel did nothing - very uncharacteristic of Intel. These symptoms repeatedly suggest a top management that does not have a viable grasp of a primary management function - the strategic objective. To have a grasp requires that management come from where the work gets done - as Grove, Noyce, and Moore did.

Obviously early efforts by the new management leaves me unimpressed and in dread - similar to my early criticisms of John Young and Carly Fiorina.

[tw]

Originally Posted by Torrere

AMD is based in Sunnydale, California. California is not now, nor has it ever been a part of Germany.

From CBSMarketWatch.com on 1 Jun 2006 entitled "AMD raising output in bid to boost share":

Advanced Micro Devices Inc., the world's No. 2 provider of chips that power personal computers and servers, is ramping up factory output in an attempt to grab more market share from larger rival Intel Corp., the company's top executives said Thursday.

Daryl Ostrander, the company's senior vice president of manufacturing, said that AMD's annual wafer starts will increase fourfold over the next three years at its factories in Germany.

"We will be fully positioned to serve one-third of the (chip) market by 2008," he told investors at the company's analyst day in Sunnyvale, Calif.

[dar512]

Originally Posted by tw

AMD's annual wafer starts will increase fourfold over the next three years at its factories in Germany

Coca-Cola has manufacturing plants around the world. That doesn't make CC a Saudi or Russian company.