Intel Strategy Moves Forward

After a long period of relative stasis, it’s becoming clear that relatively new CEO Brian Krzanich and his leadership team are driving forward with some important new strategic directions for Intel. The company is moving aggressively to shed its image as little more than a PC and server component supplier—a welcome and long overdue move. They recently unveiled a forward-looking guiding principle/strategy catch phrase, “If it computes, it does it better with Intel,” which is a concrete reflection of their desire to extend their reach and influence to other new markets.

The company previewed some of these ideas at CES, where Krzanich unveiled a complete line of Intel designed (though not Intel-powered) wearable devices, as well as board-based products. The new boards are named Galileo, for the burgeoning “maker” market, and Edison, which the company hopes to see embedded into a whole new generation of wearables and other “smart” devices (think Internet of Things, or IOT). The Galileo is made more interesting by the fact it apparently only had an 8-week gestation period from idea to shipping product—a completely unheard of time frame for the “old” Intel. The company was late to the game for mobile phones and other mobile products, so it’s good to see them getting aggressive early on in what are expected to be higher growth areas.

One of the more interesting aspects of some of these recent announcements—based on comments Intel leaders have made—is the company is willing to acknowledge it’s not entirely sure where some of these new markets are headed—a refreshingly honest perspective—yet it still wants to actively participate to help drive innovations. Whether they actually can remains to be seen of course, but there’s clearly a new perspective from the top on how the company can and should proceed.

The company has also recently started to emphasize their developments outside of CPUs, with a particularly strong focus on communications. Again, this is also long overdue as the company is virtually unknown as the number two player in the modem market. They’ve also been making the point they want to be seen as an SOC (system on chip) company, not just a CPU company. The company has talked in detail about their achievements in LTE modems and mentioned improvements in process and packaging technology that could offer improvements for flash memory and other non-CPU components. Given their strong interest in wearables and IOT, it wouldn’t be surprising to see the company making investments in technologies such as sensors and wireless power, both of which would help them offer a wider range of key components for future SOCs. In fact, they may want to consider broadening their new strategy catch phrase to say, “Make your devices smarter and better connected with Intel.”

In the realm of PCs, its traditional stronghold, Intel also continues to drive forward, with plans to drive greater awareness for portable all-in-ones, like Dell’s XPS18, as well as continuing the push for 2-in-1 devices. The company has also targeted 40 million Intel-based tablets for the year—an aggressive target that, thanks to its many investments in Android compatibility, it could very well achieve. For PCs, things are going to be tougher because many of the same challenges that have plagued the PC market remain. But even here, Intel seems to be approaching things with a new, more realistic attitude by focusing on several potential opportunities for interesting sub-segments instead of a complete PC industry turnaround.

All told, Intel’s attitude and approach seems to reflect the beginning of some important changes stemming from the recent transition between former CEO Paul Otellini and Krzanich. The company’s view is arguably getting broader, deeper and more open than we’ve seen in some time and I for one hope it represents a sign of things to come.

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Bob O'Donnell

Bob O’Donnell is the president and chief analyst of TECHnalysis Research, LLC a technology consulting and market research firm that provides strategic consulting and market research services to the technology industry and professional financial community. You can follow him on Twitter @bobodtech.

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