New Intel CEO Takes Over Chip Unit, Creates 'New Devices' Biz: Reports

The reorganization within Intel comes days after Brian Krzanich took over as the company's new CEO.

Intel CEO Brian Krzanich, on his first day on the job May 16, told shareholders that the giant chip maker had been too slow in responding to changes around mobile devices and that the company would be even more aggressive getting into the market.

He didn't take long to start making changes.

Krzanich, who replaced Paul Otellini, reportedly is overseeing a significant reorganization within Intel that will include having the Intel Architecture Group, which is responsible for chip designs, reporting directly to him and creating a new unit within the company that will focus on new devices.

In addition, Renee James, who is now the company's president and also the former executive vice president and general manager of Intel's Software and Services Group, reportedly will oversee Intel's massive manufacturing operation.

According to a report by Reuters, Krzanich, a 30-year Intel veteran, laid out those and other organizational changes in a lengthy email to employees May 20. In the email, Krzanich told the employees that Intel would move faster and more boldly to address the rapid changes occurring in the industry and adjust those plans as needed.

"Our business faces significant challenges, and we simply must continue to execute while finalizing our future strategy," he wrote, according to Reuters.

Intel's situation is fairly well known. The company by far makes the most chips for PCs and servers, two markets that bring in huge amounts of money but that are becoming somewhat stagnant or—in the case of PCs—are contracting. Intel is aggressively expanding its reach in a number of directions—including low-power microservers and data center networking and storage systems—and a key focus is the mobile space.

Currently, the bulk of smartphones and tablets are powered by chips designed by ARM and made by the likes of Nvidia, Qualcomm and Samsung. Intel is been driving down the power consumption of its low-power Atom systems on a chip (SoCs) in hopes of gaining traction in the mobile device market. Currently about a dozen smartphones run on Intel, but are sold overseas, and some tablets are also powered by Intel's x86-based chips.

However, speculation exists that the upcoming Samsung Galaxy 10.1 Android tablet will be powered by Intel's Atom "CloverTrail+" chip.

The company is hoping new Atom chips based on the upcoming "Silvermont" microarchitecture, which promises significant gains in energy efficiency and performance over current Atom SoCs and, according to Intel officials, makes the Atom platform a strong alternative to ARM for device makers.

The moves by Krzanich are designed to help the company more quickly expand its business, according to Chuck Mulloy, an Intel spokesman.

"These changes reflect the imperatives that Brian outlined last week at the stockholder meeting," Mulloy told Bloomberg. "They are designed to clarify management roles and accelerate Intel's market performance."

In his email, Krzanich reportedly told employees that Dadi Perlmutter, the executive vice president who had been general manager of the Intel Architecture Group, will help transition the unit and then get other duties within Intel. The Intel Architecture Group designs chips for PCs, servers and other data center systems, as well as mobile devices.

Mike Bell, who had been helping lead the company's mobile chip business, will be responsible for the new devices unit, Intel reported. According to Reuters, in his email, Krzanich said Bell's organization will be tasked with "rapidly turning brilliant technical and business model innovations into products that shape and lead markets."