New Microarchitecture Goes After New Business Segments

The two main changes that are currently taking place at Intel are both targeted to preserve leadership, mainly by increasing the amount of potential customers (or business segments).

Step one is to transform Intel from an IT-oriented monster into a platform company that consists of five divisions, each adjusted to a certain market space: Digital Home, Digital Enterprise including Digital Office, Mobility, the Channel Platforms and the Digital Health Group. The first three groups are pretty simple to understand, while the Channel Platforms Group will cater to offerings for emerging (growing) markets, and the Digital Health Group to cash out in the health and medical area that is pretty profitable, even today.

Each of these armies is lead by a senior Intel executive and is meant to specifically offer bite-sized platform solutions rather than supplying microchips only. It is convenient for Intel to go this way since most competitors are not quite able to follow when it comes to presenting conclusive building blocks rather than individual components only.

While such a restructuring of the firm is very likely to increase business in new and so far cold-shouldered markets, it will not be enough to persuade many players on the market to seeing an entirely changed Intel that is worth commencin business with. One pretty obvious example is Apple. Worldwide media responded rather positively on Intel's announcement to introduce an entirely new microprocessor architecture by next year. This is particularly interesting because the real meat such as significant technical data on what to expect is yet nonexistent. If, however, a heavyweight such as Steve Jobs had received more information on Intel's 2006 silver bullet (he certainly has), this could have helped him sign the contract.

Step two of course is the new family of microprocessors itself will not only change tactics, but overall stragegy. Intel claims the leadership in terms of performance per watt in 2006 and is confident of the new product phalanx capable of beating the competition. All new chips will be manufactured in smaller structures (65 rather than 90 nm today), and they are announced to be dual or quad core models with a shared L2 cache memory. This means that either two or four processor units are merged onto one single piece of silicon. Basically there is one chip design that will go into desktop, mobile and business/enterprise spaces with features, cache and clock speed as well as power consumption adjusted to these.

Although Intel gently evaded talking about price/performance per watt in its future chips, I think it would be a good idea for AMD to keep track of their new breed. If it is promising enough to convince a lone wolf such as Apple, it could turn out to be capable of influencing the somewhat fragile balance of power that we have today.