"Intel missed tablets and smartphones, but it's not too late"

Intel EVP David Perlmutter tells "Globes": Our challenge is to prove that there are no alternatives to Intel.

"It is a fact that no tablets and smartphones are based on Intel," Intel Corporation (Nasdaq: INTC) EVP and general manager of the Intel Architecture Group David Perlmutter told "Globes". "Our challenge is to prove that even if there are alternatives to the PC, that does not mean that there are alternatives to Intel."

Perlmutter says, "We may have missed the forecasts about the new computing world, but history proves that the person who is the first to arrive is not necessarily the winner, and our position will be tested in the next couple of years. If we still have nothing in three years, then we've really missed the train. It's premature to say who will win in this field, the cards are still open."

Strategically, Intel is fighting back on two fronts. The first front is to strengthen the standing of the PC. At the Computex Taipei International Information Technology Show in May, Intel unveiled a new segment of computers for its processors, the Ultrabook, which resembles the MacBook Air. Intel believes that 40% of mobile computers will have this format within two years.

"When the PC looks like that, is cheap enough, and always has internet access, many people will buy it," says Perlmutter, who uses an Apple MacBook with an Intel processor.

Intel has also unveiled its Atom processor for tablets, and it is pushing processors designed for ASUSTek Computer Inc. (Taipei: 2357) and Lenovo Group Ltd. (HKSE: 992; Bulletin Board: LNVGY) tablets.

"We have other products for this market, and we have something to prove. But past success is no guarantee of future success," says Perlmutter. "It's relevant for the company's future, because Intel must grow beyond PCs."

Intel's second front is its business for over 30 years - the silicon wafer. Two months ago, it announced a revolution in chip manufacture: in 2012, it will produce next-generation processors with 22-nanometer lithographic TriGate technology, in which the transistor directs current in three dimensions, rather than two.

In this way, Intel improves performance and cuts energy consumption. The change is not merely cosmetic; it's a computing revolution in transistor efficiency, while using less space on a silicon wafer.

Perlmutter also announced that the company's Haifa development center will no longer develop WiMAX processors. "We've diverted the Haifa team to do other things in wireless connectivity for enterprise networks," he says. "We've cancelled projects and switched people to other departments before. That's natural, and I don’t see anything unusual. There's enough work. We haven’t fired anyone."

Intel had bet on WiMAX, which fell under Perlmutter responsibilities, to lead the next mobile revolution for mobile computers. The company lost the bet, and it acquired the wireless solutions division of Infineon Technologies AG (DAX: IFN) for $1.2 billion to correct it. "The bet on WiMAX was a big one that didn’t pan out. We'll continue with WiMAX, but we'll also develop LTE," says Perlmutter.

Published by Globes [online], Israel business news - www.globes-online.com - on July 14, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

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