Design Con 2015

Rethinking Intel's Greatest Asset

View comments: newest first | oldest first | threaded
Page 1 of 2   Next >   Last >>
bruzzer
User Rank
Stock Keeper
Re: What happened?
bruzzer   1/27/2013 2:29:25 PM
NO RATINGS

Intel dominates the data center and will for some time. On the advantages of leading process monopoly, secured and sustained through structured market rigging, the enterprise is almost unstoppable in any of its component category pursuits.  While vertical integration to capture downstream producer values is a noteworthy strategy at technology transitions where costs increase and so must margins, this analyst does not believe Intel will compete with its traditional channels; because their organization, product and structural change through a computing paradigm transition are just as burdensome in defining the new competitive realities.

Analyst suspects Intel's next big push is not in mobile, where Intel can dump at and below cost all day causing all sorts of competitive havoc that have nothing to do with a superior product offering, but in processor network switch integration.

This is the next big market Intel is capable of consuming within boundary of a 10% wafer cost increase for the exponential margin of NIC in processor and perhaps some hardwired security functions that compliment.  This move surely presents a political issue among some of Intel's component compliments, and customer's with the kind of mass even Intel has a tough time pushing around. Subsequently reveals Intel's entry path into foundry on the type of high margin specific volumes Intel has already suggested and is engaged in on an experimental basis. 

What is astonishing about this sort of move, and this is the wild thought here, communications switch and route design manufacturers once procured Intel microprocessors that were good enough for their product applications procured from the unwanted overage of Intel PC IDM sales bundles.  In this way Intel could sell into communications gear at price levels acceptable for the procurement requirement.  In other words at prices hidden below Intel measures of cost delivering some margin upside to the PC IDM broker of these unwanted product grades for commercial IT & consumer computing products. Bottom of the bin that in all cases provided more than good enough performance for control plane processing.

So now will the reverse occur?  Will Intel communication foundry customers, possibly CISCO, benefit from NIC in processor supply from Intel; specific to their captive requirement, while becoming a broker of their own overage to others?And, subsequently, would create a new form of Intel sales channel. 

In the secret sauce IP world of communications switch gear not likely off the bat but please consider the potential of this procurement channel reversal.

Mike Bruzzone, Camp Marketing

Himanshugupta
User Rank
Supply Network Guru
Re: Intel in Big Data
Himanshugupta   1/26/2013 2:28:58 PM
NO RATINGS

Intel needs to open its doors to more collaboration. As far as big data is concerned, it think the biggest customers are HP and Dell. Given Intel is basically hardware provider, i do not think that they can have a good profit margin unless they own the products as they have done in traditional PC microprocessor business. The path forward for Intel is to try to capture as much hardward market in cloud computing and big data as possible.

chipmonk
User Rank
Production Synthesizer
IDM or Foundry - whats more profitable ?
chipmonk   1/25/2013 12:12:28 AM
NO RATINGS

The assumption that an IDM with proprietary design and a near monopoly to sell it at a high margin seems to be no longer true. In 2012 Intel managed a margin of 20 % but TSMC roared ahead with 36 % even though their 28 nm was just a small part of the total $ 16 billion.

Bolaji Ojo
User Rank
Blogger
Re: use your assets
Bolaji Ojo   1/24/2013 10:45:32 PM
NO RATINGS

Flyingscot, Correct but Intel may still go ahead to offer foundry services to secure a stronger presence in some market segments and also because fabs are so expensive that the handful of companies that can still finance their own fabs my have difficulties feeling them. 

Wale Bakare
User Rank
Supply Network Guru
Can This Help - Rugged Tablet?
Wale Bakare   1/24/2013 6:01:24 PM
NO RATINGS

@HH, have you read/heard of tough xTablet Windows Rugged, Tablet PC running by Intel processor?

FLYINGSCOT
User Rank
Supply Network Guru
use your assets
FLYINGSCOT   1/24/2013 5:53:35 PM
NO RATINGS

Intel surely has some of the best semicon technology these days but selling foundy services might not have the same gross margin as owning the whole shebang so Intel will need to get its strategy bang on to succeed.

Anna young
User Rank
Blogger
Re: What happened?
Anna young   1/24/2013 10:55:33 AM
NO RATINGS

@HH, the difference here is Intel realised this and the company is turning itself around. Bolaji noted in the article that Intel "will become a leading semiconductor foundry and partner to many of today's OEMs ...and future OEMs" in telecom and data networking equipment markets. I truly see them doing well. Good on them!

chipmonk
User Rank
Production Synthesizer
to survive, first the "inside" of Intel must change
chipmonk   1/24/2013 10:28:37 AM
NO RATINGS

Intel co founder and ex CEO Andy Grove claims he escaped Soviet invasion of his homeland Hungary. So its ironic that after getting to the USA he created a totally STALINIST organization INSIDE INTEL !! Apple's 1984 Superbowl ad lampooning the lemmings of Big Blue ( IBM ) applies even more to Intel.

At present Intel "inside" ( Mgmt., Sr. engineers ) is totally geared towards dominaton of a dying monopoly ( WinTel processors ). Within Intel R&D has been geared towards creating incremental improvements ( < 20 % ) every couple years and then beat the drums of Moore's Law loudly.

Without going into the technical details, let me just say that all the hoopla over FinFET ( 3-d transistors ) over the last 2 years have exposed the mediocre performance from much vaunted Intel process / mfg. R&D. Yet they have kept on marching in lock step to bigger and more expensive Fabs when its not clear that there is a growing market for PC processors. They have not delivered on SoCs because the design expertise is still wasteful X86 CISC oriented. 

At this time Intel needs to get off its traditional emphasis on ever smaller transistors ( sub 20 nm ) or larger wafers ( 450 mm ) or $ 10 billion new Fabs to build them and instead put more emphasis on various chip architectures w/o undue bias rowards X86 CISC.

Hospice_Houngbo
User Rank
Supply Network Guru
Re: What happened?
Hospice_Houngbo   1/24/2013 8:01:53 AM
NO RATINGS

@Mr. Roques,

We can ask the same question about Nokkia, RIM, Microsoft ... w.r.t to them lagging behind in the handheld devices market. Why isn't INTEL winning the smartphone chip war? The anwser is simple - They didn't see the war coming - that fast.

Bolaji Ojo
User Rank
Blogger
Re: Intel in Big Data
Bolaji Ojo   1/24/2013 6:53:31 AM
NO RATINGS

Intel is already in the big data business. Its only business unit that increased revenue in the fourth quarter was the data center group, which reported sales rose 7 percent sequentially and 6 percent year-over-year. It's an area its focusing on.

Page 1 of 2   Next >   Last >>


More Blogs from Bolaji Ojo
Could new extraction technology eliminate the conflict over conflict minerals?
If Apple plans to make a splash in the smart watch market, it will first have to dislodge some innovative products already available from competitors.
With margins extremely tight, contract manufacturers are learning to dump some contracts while expanding services in other areas.
What are electronics manufacturing services providers looking for in their OEM customers?
By moving to the core of the industry and offerings services that keep the system humming, a group within the electronics market has rendered irrelevant the question of ownership and control of the supply chain.

Datasheets.com Parts Search

185 million searchable parts
(please enter a part number or hit search to begin)
EBN Dialogue / LIVE CHAT
EBN Dialogue enables you to participate in live chats with notable leaders and luminaries. Open to the entire EBN community of electronics supply chain experts, these conversations see ideas shared, comments made, and questions asked and answered in real time. Listed below are upcoming and archived chats. Stay tuned and join in!
Archived Dialogues
Live Chat 11/12: Examining the Cyberthreat to Supply Chains
The number of cyberattacks is on the rise and hackers are targeting the supply chain. Drew Smith, founder and CEO of InfoArmor, will be on hand to discuss the reality of today's threat landscape and what to do about it.
Live Chat 11/06: Enterprise Risks, Intellectual Property & Supply Chains
Enterprise risk management (ERM) frameworks can be useful to identify, assess, and manage intellectual property (IP) risks that arise in supply chain compliance. We'll look at real-world examples and strategies for mitigating those risks.
Latest Poll
EBN Newswire
SINGAPORE AND SAN FRANCISCO   11/20/2014
Menlo Logistics Keen to Build on 2014 Growth in South Asia
Twitter Feed
EBN Online Twitter Feed