In a presentation to financial analysts on May 10, Intel CEO Paul Otellini said he was not particularly worried about the prospect of Microsoft issuing a version of Windows for ARM processors later this year. “We think [x86 is] a differentiator,” he said. “We have the advantage of the incumbency, the legacy support.”
Maybe he’s right. But it is disconcerting to hear this sort of complacency from the head of Intel, especially at a time when ARM-powered smartphones and tablets pose an unprecedented threat to Intel’s core laptop and desktop business.
I can only wonder what Andy Grove would say. Grove, who was Intel CEO from 1987 to 1998, famously wrote: “Business success contains the seeds of its own destruction. Success breeds complacency. Complacency breeds failure. Only the paranoid survive.” Grove also once ordered an advertising campaign attacking what was then the company’s most successful product the 80286 processor, in an effort to get customers to move to the newer, much more capable, and ultimately wildly successful 80386.
Grove remains a senior adviser to Intel and has always avoided any public criticism of his successors. But I find it hard to believe he is happy watching the company he built acting so passively in the face of a threat.
Side note: Intel was actually a major player in the ARM business for some years. It bought Digital Equipment’s StrongARM business in 1998. The chips, renamed XScale, powered many handheld computers and early smartphones. Intel sold the division to Marvell in 2007.
“We think [x86 is] a differentiator,” (Intel CEO Paul Otellini) said.
Differentiator? Well yeah, but probably in the opposite way that you intended it.
Intel focused on power when we had plethora of power and they neglected power management just when mobile devices required it the most. Their newer offerings may be the best ever but they’ve forever ceded the perception that they are the one and only processor that matters.
“We have the advantage of the incumbency, the legacy support.”
Really? What legacy programs do your processor’s support? Windows?
In 2007, 95% of all Personal Computing devices ran Windows. If you count phones, tablets, notebooks and desktops as Personal Computing devices (and you should), then in 2011 only 40% of all PCs run Windows.
Is that downward trend likely to reverse or accelerate? You betcha. While the sales of notebooks and desktops is flat, even declining, the growth of smart phones and tablets is exploding. The percentage of smart phones and tablets that run Intel processors? Zero.
The future is uncertain, but resting on your “legacies” is a recipe for disaster. Especially when the legacies you’re resting on are crumbling like sand castles before the relentless tide of mobile.
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