Former Intel Chief Executive Andy Grove, who died in March, invented a phrase that became famous in Silicon Valley: “Only the paranoid survive.” The chip making giant is the biggest semiconductor company in the world because it dominated the personal computer industry when Grove was in charge. But now the PC market is declining, and that is hurting the chip maker’s profits.
Intel focusing on other emerging areas
Despite the drop in PCs, the server chip industry is still doing well (Intel included) due to the rise of cloud computing at companies like Google and Facebook. However, the chip maker missed joining a number of other markets, particularly smartphones. Now it is scrambling for a place in wireless networking, autonomous areas, sensors, the Internet of Things, and other incredible areas as computing spreads from conventional computers to almost every type of machine.
In an interview, current Intel CEO Brian Krzanich said, “The mistake was, when you grow with great leadership and great success, your paranoia is focused on the one thing that is delivering that.”
When asked about PC-dominated computing, he said that now the computing is constantly shifting. Krzanich said he is still a strong believer in paranoia, but he must turn that vigilant fear in a lot of directions at once. Intel’s core may now be cloud computing, but it has to feed itself from chips in many markets. PC chips make up about 50% of Intel’s revenue even in the market’s decline.
More details expected at IDF
This week we will see the effect of those changes as the chip maker holds its Developer Forum in San Francisco. Developer events may be “nerd-fests,” but they explain more about the tech world and where a tech company wants to be in next two to four years.
Krzanich will deliver a keynote speech at the Developer Forum, where he is expected to talk on topics such as artificial intelligence, virtual reality and sensors. Last week, AI was in the news when the chip maker bought AI start-up Nervana Systems, which has technology that will be used in Intel’s data center chips. Krzanich said he is looking forward to a one-hour question-and-answer session with 200 elite developers.
Patrick Gelsinger, a longtime Intel executive and CEO of software company VMware, said the chip maker has four main business lines: mobiles, Internet of Things, servers and PCs, and it is focusing on one of them.