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Intel is going through a time of turmoil as company officials look to create a future for the giant chip company that has less to do with traditional PCs and mobile devices and more with the Internet of things, the cloud and 5G connectivity.
The upheaval has been felt in the company’s workforce (including 12,000 job cuts), its executive team and its product roadmap, including the recent decision to drop some low-power systems-on-a-chip (SoCs) aimed at smartphones to instead focus more money and effort on the other growth areas. All of this is part of a larger plan laid out by CEO Brian Krzanich, who wrote in a post on the company blog last month calling the focus on the Internet of things (IoT), cloud and 5G as part of Intel’s “virtuous cycle of growth.”
A significant step in the company’s repositioning came in November 2015 when Krzanich named longtime Qualcomm executive Venkata “Murthy” Renduchintala president of the newly formed Client and Internet of Things Businesses and Systems Architecture Group. It was an unusual move. Intel traditionally has hired top executives from within the company, but Krzanich instead went outside and tapped an official from a key competitor.
The hiring led to the exodus of several longtime Intel veterans and brought in someone who could take an objective view of the business. In an internal memo to employees in April, Renduchintala said the company needed to do a better job in such areas as competitiveness and focusing on the customer.
The changes in the company have raised questions about Intel’s game plan and future, which Krzanich looked to address in his blog post. This week, Renduchintala wrote in his own blog post about his view of Intel’s transformation and the reasons he chose to make the move from Qualcomm. A key is that Intel’s past positions it well for addressing the emerging business opportunities, he said.
With decades of experience in creating open ecosystems, powering the world’s PCs and servers, and embedding intelligence into unexpected devices, Intel is uniquely positioned to deliver the comprehensive portfolio of end-to-end hardware and software technologies for this revolution,” Renduchintala wrote. “All of this is why I’m bullish on Intel, and why I joined this company. … I know that we’ll win in the connectivity revolution fueled by the IoT. I’m resolute in my belief that Intel is the only company on the planet that can do all of this from one end of the network to the other, delivering unique value to our customers.”
Intel officials are predicting that there will be more than 50 billion connected devices that will make up the IoT by 2020, and all of those devices will need connectivity—particularly through 5G networks—and generate massive amounts of data. That is the direction Intel is headed in, he wrote.
“All of this will put unprecedented demands on today’s networks, and require a new generation of technology that can serve a far broader set of devices, volumes of data and human need for connectedness,” Renduchintala wrote. “5G is the inflection point from network needs driven largely by PCs and smartphones to an entirely new platform that connects a broad range of ‘things’ to each other, to people and to the cloud.”
Intel’s New No. 2 Executive Outlines Chip Maker’s IoT Future
He also stressed that Intel will continue to play in the PC and mobile spaces, despite reports that officials are looking to distance the chip maker from both. What needs to be understood is that the definitions of each are changing. The mobile space is no longer just about smartphones, but about the billions of devices that are making up the IoT—including phones, tablets and PCs. It also means connectivity, such as LTE and 5G modems, radio frequency, WiFi, Bluetooth and Ethernet, for devices, networking and storage appliances.
“We’re aligning our products and architectures to an entire panorama of smart and connected devices, and in so doing, we’re enabling exciting new experiences,” the executive wrote. “We are not exiting mobile, but we are broadening its definition to make it synonymous with the interconnectedness of the more than 50 billion ‘things.'”
Similarly, compute is more than just PCs and servers, but encompasses those devices connected via networks. The PC is changing, but it continues to be crucial to Intel’s future.
“The PC is foundational to our compute strategy and to our business,” Renduchintala wrote. “It’s an engine that creates critical shared IP that drives innovation across our entire product portfolio. Intel will continue to deliver an annual cadence of leadership performance and innovation in our PC and broader computing roadmap, with a focus on key growth opportunities in 2 in 1s, gaming and home gateways.”
SoCs, which had been aimed at smartphones and tablets, will now be aimed at IoT devices, from drones and robots to PCs, cars, retail systems and smartphones, he said.
Intel has the hardware and software assets for this transition, which Renduchintala said is why he is “bullish on Intel.”
“I’m resolute in my belief that Intel is the only company on the planet that can do all of this from one end of the network to the other, delivering unique value to our customers,” he wrote.