The empire strikes back under Intel's new sales chief

Intel's Core 2 Duo represents its most important product family launch since the Pentium 13 years ago as it seeks to recover sales and markets lost to AMD.

Thursday was a very important day for Intel as it introduced its Core 2 Duo family of microprocessors, representing the most significant product launch since its Pentium launch 13 years ago.

"The empire strikes back," was how Nathan Brookwood, microprocessor analyst at Insight64 termed it. And that's an excellent comment on what this launch means to Intel, the world's largest chipmaker. 

The Core 2 Duo launch is more than just a new microprocessor family; it represents Intel's determination to return to its core capabilities after embarrassing missed product deadlines, less than successful forays into other businesses, and market share lost to rival Advanced Micro Devices.

To further underline the importance of this event, just days before the launch Intel appointed its most effective and aggressive senior executive, Sean Maloney to lead its global sales and marketing

Over the past 24 years Mr Maloney has earned a reputation as Intel's top troubleshooter. He is the one that Intel relies upon to tackle some of its most difficult business problems.

Mr Maloney used to head Intel's UK operations and then became technical assistant to CEO and chairman Andrew Grove. From 1992 to 1995 he worked side-by-side with Intel's legendary top executive, learning all aspects of the business. This is how Intel grooms executives destined for its senior ranks.

Through a series of senior positions Mr Maloney quickly became known as one of Intel's most effective and aggressive managers, tackling some of the company's most difficult jobs such as rebuilding its troubled communications chip group.

Now, Mr Maloney has again been handed one of the company's most challenging jobs: reigniting sales and growth for what insiders call "Intel 3.0," the next big phase of Intel's business strategy. Intel 3.0 represents the third reinvention of the company.

Very few people remember that Intel started off as "the memory chip company," then it became "the microprocessor company," and now it is set on a new course to become "the platform company."

But Intel is like a supertanker in that it takes a while for it to set up a new course; when it does, it becomes an extremely aggressive competitor.

AMD, located just a stones throw away from Intel's HQ, has done well to exploit changes in microprocessor markets. Now it faces the full might of a refocused and reenergized Intel determined to win back any lost market share--and then some. Yet AMD's response is puzzling.

Earlier this week it announced plans to acquire Canadian graphics chip maker ATI Technologies in a $5.4bn deal. This is not the time to be distracted by a huge merger--unless AMD's management is looking to ATI as a life raft. In fact, a life raft might be the best way to view this deal if you consider that AMD has to develop its own multi-core chip family, develop global sales channels, *and* invest billions of dollars in building new chip fabs, which, by the way, includes mastering a new manufacturing process at 65nm.

Each one of these are extremely challenging and risky endeavors. I cannot see how AMD can continue to gain market share and profit at Intel's expense. It is up against a competitor that just announced a record number of 550 PC/notebook design wins; and 200 server design wins for its new microprocessors. Intel has already successfully made the transition to 65nm production; plus it has one of the industry's most capable managers, Sean Maloney, leading its global sales push.

This is the Empire Strikes Back--with a vengeance.