The Friday Interview: Paul Otellini, Intel

30 Jun 2006

This week CEO and president of Intel Paul Otellini (pictured) shares his views on the industry.

Intel is historically renowned for its strategy of ‘betting the company’. Does that still apply?
Every time we build one of these [manufacturing facilities, as in Leixlip] we plunk down US$3bn; we say we’re building platforms for products that don’t exist yet. You’re always betting on the future.

Intel has been perceived as losing ground to some rivals lately but you have three new chips that you’re going to launch this summer. What can you tell us about them?
These products, we believe, are extremely competitive and we’ll ramp them more rapidly than any microprocessor architecture ever before. I think we’ll significantly alter the competitive landscape. The Xeon [processor] not only delivers higher performance, it’s 40pc faster and has 40pc lower power. The combination of that, as a user, is significant. If you have a data centre you save on the cost of electricity and you don’t have to put in extra cooling and air conditioning. The notebook chip is faster and gives higher performance and longer battery life. That’s a pretty good deal.

How can a regular user justify buying a computer with one of these new processors if all they use a PC for is word processing and email?
What is an average user? How many of us now are looking at videos on These higher-performance machines are needed to do that: you don’t want to wait for a movie to download. Simplistically viewing home computing as email and doing your taxes is a very narrow view of the world. Using the PC as an archive for family records and photos or for videoconferencing when travelling to keep in touch with your kids — all of that needs more performance.

Analysts have said there has been a slowdown in component sales. Do you think buyers are waiting for the new chips to come out instead of buying now?
We said in December that we saw the rate of growth attenuating. It was down below seasonal levels for a variety of reasons; we saw the rate of industry growth slowing but we also said we’ll see the seasonal growth in the second half of the year.

Why is Intel not involved in producing processors for games consoles?
Games consoles come out once every five years. Intel drives performance up every quarter. If you look at the performance gamers can buy, the PC is still the best bet, in my view, over a single-purpose console.

By Gordon Smith

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