Encyclopedia
Intel Corporation , founded in 1968 as
Integrated
Electronics Corporation and based in
Santa Clara, California,
USA, is the world's largest
semiconductor company. Intel is best known for its PC microprocessors, where it maintains roughly 80% market share. Intel also makes
motherboard chipsets,
network cards and other networking ICs, flash memory, embedded processors, and other devices related to communications and computing. Intel's core competency is based not only in its chip design capability but in its world class manufacturing operation; the company is at the leading edge of advanced process technology and also has advanced research projects in all aspects of semiconductor manufacturing, including
MEMS.
Overview
Intel was founded in 1968 by
Gordon E. Moore and
Robert Noyce when they left
Fairchild Semiconductor. It is noteworthy that Intel competitor
AMD was also founded by members of the
Traitorous Eight, in 1969. Intel's fourth employee was
Andy Grove , who ran the company through much of the
1980s and the high-growth
1990s. It is Grove who is now remembered as the company's key leader. By the end of the 1990s, Intel was one of the largest and most successful businesses in the world, though fierce competition within the semiconductor industry has since diminished its position somewhat.
The basis of the company fortunes rested, at its inception and now, on the concept of putting a computer, or at least its CPU onto a single chip - originally as a way of generalising the circuitry of devices such as calculators and then - as everyone now knows - to provide the power for the new PCs. It was Intel's invention which really made the PC age possible. Even so, it was IBM's entry into the PC market which really took Intel into the big league.
The company currently has nearly 100,000 employees and 200 facilities world wide. Its revenues for 2005 were $38.8 billion. Its Fortune 500 ranking is 49th, and its stock symbol is INTC.
Competitors
During the 1980s, Intel was among the top ten worldwide semiconductor sales leaders , dominated by Japanese chip makers. In 1991, Intel achieved the number one ranking and has held it ever since. Other top semiconductor companies include
Samsung,
Texas Instruments,
Toshiba and
STMicroelectronics. For more information, refer to the
Worldwide Top 20 Semiconductor Market Share Ranking Year by Year.
In terms of direct competitors, Intel's chief rival in PC microprocessors is
Advanced Micro Devices . Competitors in PC chipsets include
VIA Technologies, SiS, ATI, and
NVIDIA. Intel's competitors in networking include
Freescale,
Broadcom, Marvell, and AMCC, and its competitors in flash memory include Spansion, Samsung,
Toshiba, STMicroelectronics, and Hynix.
SRAMS and the microprocessor
The company's first products were random-access memory integrated circuits, and Intel grew to be a leader in the fiercely competitive
DRAM,
SRAM, and
ROM markets throughout the 1970s. Concurrently, Intel engineers Marcian Hoff,
Federico Faggin, Stanley Mazor and Masatoshi Shima invented the first
microprocessor. Originally developed for the Japanese company Busicom to replace a number of ASICs in a calculator already produced by Busicom, the
Intel 4004 was introduced to the mass market on November 15, 1971, though the microprocessor did not become the core of Intel's business until the mid-1980s.
From DRAM to microprocessors
In 1983, at the dawn of the
personal computer era, Intel's profits came under increased pressure from
Japanese memory-chip manufacturers, and then-President Andy Grove drove the company into a focus on microprocessors. Grove described this transition in the book
Only the Paranoid Survive. A key element of his plan was the notion, then considered radical, of becoming the single source for successors to the popular 8086 microprocessor.
Until then, manufacture of complex integrated circuits was not reliable enough for customers to depend on a single supplier, but Grove began producing processors in three geographically distinct factories, and ceased licensing the chip designs to competitors such as
Zilog and
AMD. When the PC industry exploded in the late 1980s and 1990s, Intel was one of the primary beneficiaries.
Intel and the IBM PC
What was, in the early 1980s, seen as a miraculous device, the 8088 processor, now seems puny; as over the succeeding years the range of chips was incrementally upgraded through the 286, the 386, the 486, and eventually the Pentium and beyond. Intel has planned to boost the power of the chip with a new generation every two years - even by the time of the launch of the Pentium there were already 3 million transistors on a chip, which had the power to process 100 million instructions per second or 100MHZ ; now, with clock speeds running into several thousand million instructions per second on even cheap PCs, it seems as it the sky is the limit - though it is difficult to see what needs anything like this.
Considering the degree to which Intel is now a major competitor, it supplies most of the chips which go into PCs and heavily advertises the Intel chip , IBM's attitude has been very strange - almost acting as its godfather. Unlike
Microsoft, where similar initial support created a multi-billion dollar corporation - but relations then deteriorated , Intel has never been really challenged by IBM. Indeed, when Intel ran into a financial crisis in 1983, when it could not pay for the rapid growth it was experiencing, IBM stepped into buy a 20% stake, and thus fund its further development . This IBM support was consolidated by a technology agreement between the two companies in 1986. IBM sold the stake, as soon as it could get its money back; a mistake, when - in the 1990s - that 20% stake would have been worth more than the whole of IBM.
This position was doubly surprising, since IBM then had by far the world's greatest expertise in chip technology. It was able make chips, in its laboratories, which were probably an order of magnitude more complex than those of Intel and had invented the RISC technology which potentially made chips run many times faster still; technology which had cost IBM billions of dollars to develop. It was then itself probably the world's largest chip maker , yet it still treated Intel as a favoured godchild - even as the company beat IBM hands-down in the 'chip war'. According to Robert Heller, in 'The Fate of IBM', over the five years after IBM's RISC chips were finally launched on the world they sold only 300,000 chips to Intel's 20 million.
PaIt has been claimed that it was Bill Lowe's indecision, when he headed up the
IBM PC Group, that gave Intel its dominant position - much as it did for Microsoft. The turning point certainly seems to have been Intel's launch of the 386 chip. Before that point IBM probably had the upper hand, after it Intel was in control. IBM had misjudged its position in relation to the market; and had lost its position as technological leader. It had also misjudged its technological capabilities. It had assumed that, with its cross-licence agreements on Intel's chips, it would be able to later produce a modified, and better, chip which would make those of its competitors which had already launched 'IBM-incompatible 'obsolete. Unfortunately, despite its great technical capabilities in the field, it never did this - and conceded the standards to Intel. Thus, the 386 - which became an excellent workhorse of the PC industry, and sired just as successful follow-ons - effectively sidelined IBM as the hardware standards setter in the PC field. Yet, despite his rages at almost everyone else in sight, John Akers still seemed to have this godfatherly approach to the corporation IBM was trying to beat.
By the 1990s, therefore, Intel had set the standard for PCs in a way that IBM had failed to do - enjoying the same sort of dominant position as IBM had in mainframes earlier. IBM's position was, however, still equivocal. It entered into a new agreement with Intel in 1991, but by 1994 it was also working with Intel's clone-producing competitor, CYRIX. Above all, it had earlier been reduced to seeking - yet another - a partnership; this time with its rival
Apple and
Motorola to try and develop the RISC approach - seemingly to dent Intel's dominance. In 1994 this eventually bore fruit in the form of the PowerPC chip, which was - in another strange addition to the history of IBM's joint ventures - massively promoted by Apple as a vehicle for IBM users to switch to its PC offering. Surprisingly, though, IBM - in another equivocal gesture - reported that it would itself remain with Intel designs for the PC; reserving the PowerPC for its workstations and low-end mainframes.
The rise of PC architecture
During the
1990s, Intel's Architecture Labs was responsible for many of the hardware innovations of the
personal computer, including the
PCI Bus, the
PCI Express bus, the
Universal Serial Bus , and the now-dominant architecture for multiprocessor servers. IAL's software efforts met with a more mixed fate; its video and graphics software was important in the development of software digital video, but later its efforts were largely overshadowed by competition from
Microsoft. The competition between Intel and Microsoft was revealed in testimony at the Microsoft antitrust trial.
New architectures are developed alternately in
Santa Clara, California,
Hillsboro, Oregon and now at
Haifa,
Israel.
Santa Clara, California
- P5 Pentium finished 1993
- P7 64 bit x86 core 64 bit successor to the P6 dropped 1994
- P7 new 64 bit IA-64 Merced/Itanium
Hillsboro, Oregon
Partnership with Apple
On June 6 2005,
Apple Computer CEO
Steve Jobs announced that Apple would be
transitioning from its long favored
PowerPC architecture to the Intel
X86 architecture. Reasons stated for the change were vague but included thermal issues with recent PowerPC G5 chips and an implication that the future PowerPC roadmap was unable to satisfy Apple's needs for computing power. In particular, the large power requirement of the G5 chip and subsequent heat generation was seen as a major stumbling block, preventing the placement of such a chip in one of Apple's
laptop computers. The first Apple computers containing Intel CPUs were announced on January 10, 2006. Apple initially planned to put Intel chips in all of their computers by the end of 2007, but Apple managed to have its entire consumer product line running on Intel processors by early August 2006. While the server model, the Xserve, is updated to Intel Xeon processors, it will not be shipping until October 2006, where it can be ordered in a configuration similar to Apple's Mac Pro.
Competition, antitrust and espionage
Intel's dominance in the
x86 microprocessor market led to numerous charges of antitrust violations over the years, including
FTC investigations in both the late
1980s and in 1999, and civil actions such as the 1997 suit by
Digital Equipment Corporation and a patent suit by Intergraph. Intel's market dominance combined with Intel's own hardball legal tactics made it an attractive target for litigation, but few of the lawsuits ever amounted to anything.
The only major competitor to Intel on the
x86 processor market is
Advanced Micro Devices , with which Intel has had full cross-licensing agreements since 1976: each partner can use the other's
patented technological innovations without charge after a certain time. Some smaller competitors such as
VIA and Transmeta produce low-power processors for small factor computers and portable equipment.
A case of industrial espionage arose in 1995 that involved both Intel and AMD. Guillermo Gaede, an Argentine national formerly employed both at
AMD and at Intel's Arizona plant, was arrested for attempting in 1993 to sell the
i486 and
Pentium designs to AMD and to certain foreign powers nytimes.com. Gaede videotaped data from his computer screen at Intel and mailed it to AMD, which alerted Intel and authorities, resulting in Gaede's arrest . Gaede was convicted and sentenced to 33 months in prison in June of 1996.
Intel filed its response to an
AMD lawsuit in September 2005, disputing AMD's claims, and stating that its business practices are fair and lawful. In its rebuttal, Intel laid out the skeleton of its legal defense, which included a deconstruction of AMD's offensive strategy and levied the charge that AMD's long-struggling market position is largely a result of bad business decisions and management incompetence, including underinvestment in essential manufacturing capacity and overreliance on outsourcing chip foundries .
Legal experts predict the lawsuit will most likely drag out for a number of years, since Intel's response indicates they are not likely to try and settle with AMD.
Leadership
Robert Noyce was Intel's CEO at its founding in 1968, followed by co-founder
Gordon Moore in 1975.
Andy Grove became the company's
President in 1979 and added the CEO title in 1987 when Moore became Chairman. In 1997 Grove succeeded Moore as Chairman, and Craig Barrett, already company
president, took over. On May 18 2005, Barrett handed the reins of the company over to
Paul Otellini, who previously was the company president and was responsible for Intel's design win in the original
IBM PC. The board of directors elected Otellini, and Barrett replaced Grove as Chairman of the Board. Grove stepped down as Chairman, but will be retained as a special advisor.
Corporate governance
Current members of the board of directors of Intel are: Craig Barrett, Charlene Barshefsky,
John Browne, James Guzy,
Reed Hundt, James Plummer, David Pottruck, Jane Shaw, John Thornton, and David Yoffie.
Origin of the name
At its founding, Gordon Moore and Robert Noyce wanted to name their new company "Moore Noyce". This name, however, sounded remarkably similar to "more noise" — an ill-suited name for an
electronics company, since noise is typically associated with bad
interference. They then used the name NM Electronics for almost a year, before deciding to call their company
INTegrated
ELectronics or "Intel" for short. However, Intel was already trademarked by a
hotel chain, so they had to buy the rights for that name at the beginning.
By coincidence, the BBC television science-fiction serials
A for Andromeda is the title of a 1961 [i] British television drama series and novel by astronomer Fred Hoyle [i] ...
and its sequel
The Andromeda Breakthrough had earlier featured a sinister multi-national electronics corporation named Intel, which had been involved in a plot to take control of a powerful computer constructed on Earth from alien radio instructions.
There are some people who believe that the name "Intel" is originated from "
INTELligence" or
INTErna
Ls, but actually the name is originated from "Integrated Electronics" and nothing other than that.
Finances
Intel's market capitalization is $119 billion . It publicly trades on
NASDAQ with the symbol INTC, and is a member of the following indexes:
Dow Industrials, S&P 500, NASDAQ-100, SOX , and GSTI Software Index.
Diversity
Intel has a Diversity Initiative, including employee diversity groups as well as supplier diversity programs . Like many companies with employee diversity groups, they include groups based on race and nationality as well as sexual identity and religion. In 1994, Intel sanctioned one of the earliest corporate Gay, Lesbian, Bisexual, and Transgender employee groups , and supports a Muslim employees group , a Jewish employees group , and a Bible-based Christian group
Intel received a 100% rating on the first Corporate Equality Index released by the Human Rights Campaign in 2002. It has maintained this rating in 2003 and 2004. In addition, the company was named one of the 100 Best Companies for Working Mothers in 2005 by Working Mother magazine. However, Intel's working practices still face criticism, most notably from Ken Hamidi , a former employee who has been subject to multiple unsuccessful lawsuits from Intel.
Advertising
Intel has become one of the world's most recognizable computer brands following its long-running "Intel Inside" campaign. The campaign, which started in 1990, was created by Intel marketing manager Dennis Carter . The five-note jingle was introduced the following year and by its tenth anniversary was being heard in 130 countries around the world.
The Intel Inside program was very lucrative for advertisers. Intel paid half the advertising costs for any ad that used the "Intel Inside" logo. However, in print media, Intel stipulated that the page the ad was on must not contain any references to competitors, such as AMD. If the ads didn't meet these requirements, Intel did not pay half the cost, and the advertiser was prohibited from using the "Intel Inside" logo. Intel employed staff whose primary function was looking for advertisements which violate the agreement. Advertisers found doing so—many of which were "mom and pop" shops ignorant of the reimbursement agreement—were requested to stop violating the use of the logo and were then told how to legally use the logo and get part of their advertising costs reimbursed.
The Centrino advertising campaign has been hugely successful, leading to the ability to access wireless internet from a laptop becoming linked in consumers minds to Intel chips. In the UK this has caused some controversy, as the ASA upheld complaints that this was a misleading advert.
In 2006, Intel has expanded its promotion of open specification platforms beyond Centrino, to include the Viiv media centre PC and the business desktop Intel vPro.
PC companies advertising products containing Intel chips are required to include the jingle in their film and television advertisements in order to receive the reimbursement.
In December 2005, Intel phased out the "Intel Inside" campaign in favor of a new logo and the slogan, "Leap ahead". The new logo is clearly inspired by the "Intel Inside" logo. In fact, sometimes "Intel Inside" is used, only this time with the processor name between the two words. Like so: "Intel Core Duo Inside".
In mid January 2006, Intel announced that they were dropping the long running Pentium name from its processors. They phased out the Pentium names from mobile processors first, when the new Yonah chips, branded Core Solo and Core Duo, were released. The desktop processors changed when the Core 2 line of processors were released. The Pentium name was first used to refer to the P5 core Intel processors and was done to circumvent court rulings that prevent the trademarking of a string of numbers, so competitors could not just call their processor the same name, as had been done with the prior 386 and 486 processors.
Though some in the Macintosh community were concerned that Intel's branding, including the decals and jingle, would be used with the new Intel-based Macintoshes , this has not occurred.
Intel's "Intel Inside" campaign has generally been considered to be world class marketing. However, over the years there have been several plays on the Intel branding scheme which have appeared on the web. While such jabs at Intel are obviously beyond the company's ability to control, they do tend to show that not everyone believes that Intel's programs and policies are always world class. For example, there is the popular "evil inside" logo, the ubiquitous picture of a tombstone with "R.I.P Intel Inside" , and the descriptive "Idiot Outside" logo: .
Intel is a major sponsor of the BMW Sauber Formula 1 racing team.
Intel outsources much of their 1st and 2nd line technical support in EMEA to UK volume agency MM Teleperformance.
Jingle
The famous "D? D? G? D? A?" jingle was written by Walter Werzowa from the Austrian 1980s sampling band Edelweiss .
Sale of Intel's XScale processor business
On June 27, 2006, the sale of Intel's XScale assets was announced. Intel agreed to sell the XScale processor business to Marvell Technology Group for an estimated $600 million in cash and the assumption of unspecified liabilities. The move is intended to permit Intel to focus its recources on its core x86 and server businesses. Both parties advised they expect to close the transaction within five months, at which time Intel will continue manufacturing Xscale processors until Marvell secures other manufacturing facilities.
See also
References
External links
Data
