Intel CEO Paul Otellini said Tuesday that second quarter chip orders are "a little better than we expected," questioned the fate of Sun's Sparc chip and handicapped the potential growth markets for the chip giant.
Otellini reiterated previous comments that PC demand has bottomed out and a recovery is underway.
Otellini's message at the company's investor powwow was that Intel's architecture would be able to mix and match cores and target various markets as needed. Meanwhile, Intel has the capital to venture into new markets. "This recession has given us the opportunity to play to our strength," said Otellini.
The end goal for Intel is to focus on every form factor ranging from PCs to consumer electronics to handhelds.
Among the highlights of Otellini's talk:
- The server market fragmenting and Otellini took aim at Sun's Sparc chips. "The fate of Sparc is up in the air right now," said Otellini, who added that Intel plans to push Xeon into data centers that are run by Sun's Sparc chips.
- "There are at least three form factors that'll be around for some time: The handheld, netbook and laptop," said Otellini. He also refuted the concept that the netbook would cannibalize the laptop given performance needs, keyboard side and preferences. Intel wants to target all three categories.
- Enterprise server is an interesting opportunity for Intel because of the age of the hardware in data centers. "You can throw out up to nine of your old servers and replace them with one Nehalem server and get payback in nine months or less," said Otellini.
- "The old boring desktop is about dead," said Otellini. "(But) there's an 800 million unit installed base and 45 percent of them are more than three years." Otellini noted that there is an evolution in design on the desktop, pointing out HP's touch screen design. Also Atom powered desktops are a growth market.
- "Nettops is the under recognized cousin of netbooks," said Otellini, who indicated that these nettops could replace desktops. The game isn't to reinvent the desktop, but "milk" the 800 million installed base.
- The consumer electronics market is an opportunity for Intel, but it's a slow developing market. "Consumer electronics will embrace Intel and the Internet in a phased fashion," he said. Otellini added that Intel has a few design wins for Internet connected set-top boxes. "All consumer electronics will connect to the Internet," he said.
- Otellini also said Intel would increasingly focus on software focused on compatibility, new features for gaming and Linux contributions.
- And finally Intel maintained that its manufacturing prowess will be the company's competitive edge. "There's a lot of talk around integrated device manufacturers going the way of the do-do," said Otellini. He said that many manufacturers are moving to "foundry land." If you can get a return on capital you can save on costs. Otellini argued that it couldn't execute on its plans if it outsourced manufacturing. "The leading edge is lower on costs," he said.