Intel talks ultrabooks, mobile, but future rides on data centers

Intel talks ultrabooks, mobile, but future rides on data centers

Summary: If you assume that there's a post-PC era about to get started, Intel's data center business will become even more important because it's the only sure bet the chip giant has.

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Intel can talk ultrabooks, energy efficient screens and smartphones and tablets forever, but the company's growth rate still rides with the data center.

At the Intel Developer Forum this week, the focus was clearly on the evolution of the PC. Intel touted a partnership with Google so Android and Intel chips will work well together and plans to be a tablet player.

Simply put, there are wild cards about almost everything Intel executives spoke about this week. Can Intel crack tablets and smartphones? Can Intel's architecture compete with ARM? Will ultrabooks really juice PC sales? The list goes on.

In fact, the only certainty about Intel---that its server chips happen to run the data centers and cloud infrastructure that serves up all of these trendy apps---was largely ignored.

JMP Securities analyst Alex Gauna said in a research note:

Data Center momentum remains a bright spot for the story, and the company strove to dispel speculation that the Romley upgrade cycle is being delayed in stating that the company is already shipping next-gen server ICs for revenue, that HPC deployments will happen this year, and that enterprise solutions will be ready in 1Q12. The combined demand effect is expected to exceed the last major refresh by 20x, although it is not entirely clear how this is measured or phased in.

It's almost comical how much of the focus on Intel revolved around smartphones and tablets given how little revenue is involved. Sure, you need future products to wind up developers, but let's get real about what's paying the bills. For Intel, PCs---form factor under construction---and servers pay the bills.

If you assume that there's a post-PC era about to get started, Intel's data center business will become even more important. Today, Intel's data center group accounts for roughly 19 percent of the company's total revenue for the six months ended June 30. That tally was second behind the PC unit (65 percent of sales). If ultrabooks don't save the day that ratio will shift toward the data center side of the business.

Kirk Skaugen, head of Intel's data center group, said that the chip giant plans to double volume by 2016, grow its storage and networking business at a 30 percent compound annual growth rate and grow its HPC (high performance computing business).

Those targets sure beat scrapping for margin and market share with the likes of Qualcomm and Nvidia on smartphones and tablets.

Intel's tasks for the next few years look like this:

  1. Reinvent the PC so the company can sell more chips.
  2. Dent the tablet and smartphone market.
  3. And grow the data center business like crazy.

The only sure bet is that last one. There was almost an inverse relationship between what Intel highlighted this week and actual growth prospects.

Related:

CNET:

Topics: Laptops, CXO, Data Centers, Hardware, Intel, Mobility, Storage, Tablets

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14 comments
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  • RE: Intel talks ultrabooks, mobile, but future rides on data centers

    Intel is trying to hedge the bet with android so that it can capture some tablet market if Win 8 doesn't do well with tablets.
    Its a Win-Win situtation for Intel.

    If Win 8 do well, then Android will become irrelevant and may only have a mobile share.
    owlnet
  • Growth

    MIPS growth, yes.
    VIRTUALIZATION growth, yes.
    PROCESSOR growth, yes.
    BIG EXPENSIVE INTEL CPU growth .....
    BrentRBrian
  • RE: Intel talks ultrabooks, mobile, but future rides on data centers

    The big winner in the long term will be Oracle with their virtualization environment for Exadata databases and Exalogic cloud.

    On the other side, Intel has made a deal with the Devil (Google) and will pay its consequences, Google devices with Intel CPUs won't sell well, why? Because their crappy OS which doesn't have any productivity apps on screens larger than a smartphone. Google docs and Gmail just suck if you don't have Internet connection, their offline mode is just for read only access.
    Gabriel Hernandez
  • NVIDIAMD

    Intel has to take a run at the mobile computing business, and the ARM vendors, to keep them in their place. That includes keeping margins low in mobile computing. The risk to Intel is that Nvidia, Qualcomm, etc. get so fat and happy making ARM chips that they start having dreams of following AMD into the x86 business. The way to prevent that is to make sure that the ARM licensees aren't making enough money to launch a big new R&D effort.
    Robert Hahn
  • Have to disagree...

    Yeah, yeah, I have heard the "it's the post PC era" mantra and frankly, that is a very long way off and no the cloud is not going to cahnge everything, at least not until connections are more robust and reliable. Not to be mean there is also the massive issue of security with any cloud based solution. Finally, history has shown that people prefer a PERSONAL computer over a dumb terminal which is really all a "browser device" is.

    What we will see is a massive expansion in "devices" of all flavors and functions. These include teh dozens (hundreds) of things in our homes few have even considered. Smart devices to handle energy management in the home will be every where.

    Intel will of course work to be the supplier of the processing / communications chips in these systems and it won't be done with ARM processors. Intel is nearly ready to roll out their "3D" (tri-state gates) technology and with its ultra low power requirements and raw processing power will blow the doors off the ARM CPU's.

    My take... I've seen so many people make the claim that Intel is going to fall down or will be forced to play the competitions game its little more than a running joke. Intel has been here many times and everytime they bring out new tech that changes the game. This will be no different.
    NoAxToGrind
    • Yeah and if tablets replace many laptops...

      @NoAxToGrind For many people a tablet is sufficient for most of what they do in the mobile space. When they need performance, it is back to the desktop. I already have friends that no longer use their laptops and use their tablet. Then when they need to do photo, music or video editting they have a nice powerful, expandable and yet inexpensive PC to do the heavy lifting. It is easier to fit more memory, drive space and video into a desktop vs laptop.
      MeMyselfAndI_z
      • RE: Intel talks ultrabooks, mobile, but future rides on data centers

        @MeMyselfAndI_z <br>Your are absolutely right, What I want is a Dell Tablet running Web OS. It is the only, tablet with the hardware features that I want. However since it is not a Google premire partner the O/S sucks worse than the the standard Android tablet.
        redave
  • RE: Intel talks ultrabooks, mobile, but future rides on data centers

    There will be no post PC. It will be PC plus other stuff.
    hayneiii@...
  • RE: Intel talks ultrabooks, mobile, but future rides on data centers

    The author of this article should be running for political office, as his ability to see the future is clouded with his own spin on whats next.
    The problem is his hypothesis is based on more fiction than fact.
    A good sci-fi story would have more facts then he purports to have.
    sickntired44
  • RE: Intel talks ultrabooks, mobile, but future rides on data centers

    With data centers, there is nothing better than an IBM mainframe. The {curly brace} guys have got it all wrong. COBOL still reigns supreme in terms of users.
    jbharidng
  • Still with that &quot;post-PC&quot; mantra?

    The ultrabooks are part of the future, yet, from the specs, they're just lighter and thinner and faster and more powerful... PCs. <br><br>Heck the tablets of the future will be fully capable PCs, but, thinner, lighter, smaller, and with full blown OSes, which will be able to be accommodated on those more powerful tablets. <br><br>So, instead of "post-PC" era, we'll be talking about the "post-Tablet" era, because, those future tablets won't resemble the crippled tablet devices of the present, and they'll be more like PCs of the present. <br><br>So, we'll be going "back to the future".
    adornoe
  • RE: Intel talks ultrabooks, mobile, but future rides on data centers

    Too bad if these datacenters start using quad and eight core arm processors in the future...less power, less heat, les space, cheaper processors. Somehow I don't think anything is a sure bet for Intel in the long run.
    devScott
  • RE: Intel talks ultrabooks, mobile, but future rides on data centers

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    iceberg34
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