Why did Intel risk alienating key software partners like Microsoft by buying McAfee? We've been puzzling since the announcement over what the appeal was, not so much of McAfee specifically but of any software developer that competes with companies whose only business is software. Intel has a large software division - everything from compilers and programming tools to graphics drivers to Wi-Fi software that makes one Wi-Fi card act like two - but none of that is really for sale. And that's actually the reason - for this and another strange new deal.
Intel and McAfee had been working together for nearly two years on security software they both think is going to change security significantly. It's around whitelisting - not in the common sense of choosing what apps can run and blocking everything else, but letting an ISP know what PCs are clean and can safely connect to the network without making it part of a botnet (the vast number of infected PCs they see coming on line every day is something that ISPs don't like to talk about). That's technology McAfee itself acquired and it turned to Intel to see if it could build it into the hardware of the PC, where it can't be subverted by a hacker, along with what Intel's senior vice president for software and services Renee James calls 'trusted identity'; presumably using the TPM to prove to, say, your bank, that your PC is really your PC and not a hacker who phished your password. Using these tools in the hardware, James told us at IDF, "We can block zero day attacks. We can really start to go to work on the known good, not just on going after [the problem of] cleanup the way we know McAfee today." And, by the way, she hinted that the TPM and the VT technology that makes virtualisation fast enough to be useful, which are built into vPro business laptops today could make their way into Atom processors "over time".
But why buy McAfee? Why not just build the hardware into Atom the way Intel has built it into Centrino Pro and vPro and let software developers build tools and services that use it, the way software developers have always built tools and services that use the features of Intel hardware? Because users don't pay Intel for doing that.
This new security needs something in the hardware that Intel has to develop and build. "There are features of our microprocessor and chipset that can be used to secure known threat surfaces; there are several known threats that we found we could block through hardware - we could block things they could not block in software." But after investing in developing the hardware that gives you the extra protection, Intel can't charge you for it themselves, James pointed out to us. "The way you get paid is through software and services, even though the blocking is done through hardware. The best we could hope for is a revenue share - and that would be pretty small."
A few years ago the exponential growth of Moore's Law hit the wall of physics and bounced, and Intel had to go from just making chips faster every year to making them smarter. More cores, specialised instructions for making image editing and video transcoding and encryption and image recognition faster - Intel has to find ways to use the extra transistors it can cram onto silicon, and ways to make us keep paying for them. Tools that make PCs harder to infect are going to be part of the chips Intel sells, and that will mean you buy a new PC - and the software that turns on the protection as well. McAfee will be just one of the places you can buy it from (or Intel would be facing another visit from the FTC to discussion what's innovation and what's throwing your weight around), but that means at least one of the places you can buy it from makes Intel money.
UPDATE I spotted another way Intel is trying to get more money out of you for the power of the hardware you've already paid for. Engadget is reporting on a $50 Best Buy upgrade - for a CPU. Pay an extra $50 and you can download software to unlock HyperThreading and 1MB of L3 cache on the new Pentium G6951 processor, at least in what Engadget calls "select markets".
How should Intel be making money to fund it's ever-more-demanding CPU fabs? 32nm and down takes money to develop and if we're not ready to pay enough up front for Intel chips to give them sufficient profit on adding in more features, is selling hardware features in the guise of software a canny business model or an ethically dubious lock-in? IBM was notorious for offering 'hardware' upgrades on mainframes that were existing features unlocked by software. But if you're getting a lower price and an upgrade with minimal disruption, is it a bargain or should Intel just give you the full power of what you bought to start with? What do you think?