Intel Chooses A New Path And It Feels Like The Right One

By Patrick Moorhead - April 26, 2018

Intel has been on the move for the past few years driving an incredible amount of change. Once focused exclusively on X86 processors for PCs and servers five years ago, the company has branched out into what it calls “data-centric” which takes datacenter and adds automotive via a MobilEye acquisition, FPGAs via an Altera acquisition, machine learning training via a Nervana and Movidius acquisition and diving head-first into 5G and networking. With that, the company has embraced heterogeneous computing where it is more agnostic about what compute unit does a specific workload, be it CPU, GPU, FPGA, programmable and non-programmable ASIC. Lots of change.

Today during Intel’s earnings conference call, the company underscored again how it is approaching things differently, not only in terms of silicon density but something even bigger. While some will stare unendingly at the revised 10nm dates, and believe me, I will stare at it for a little while, I see something bigger here, one of the biggest changes at Intel in the nearly 30 years I have been covering Intel as a customer, competitor and now tech analyst. During its earnings call, Intel announced that it was resetting dates for volume 10nm manufacturing from 2H 2018 to 2019. CEO Brian Krzanich owned up to not delivering as the company intended on the new 10nm node which I was glad to see. That said, this really shouldn’t come as a surprise given the groundwork the company has laid in the past. Last year at Intel’s manufacturing day, Intel exec Murthy Renduchintala made a point of emphasizing that all the levers are meaningful - architecture, packaging, “specialized engines,” and yes, still, silicon and transistor development. And, the performance gains the company keeps demonstrating with its 14nm products show this playing out.
It is apparent to me that this is the beginning of a new chapter at Intel – and a needed one.  Optimizing products for today’s world takes specialized silicon with different combinations and sizes of CPU, GPU, FPGA, and ASIC. Optimizing would require best of breed IP blocks at different transistor densities, many built by Intel (but not all), some seriously advanced packaging and architecture to stitch all the IP blocks together at high performance and low power. If it’s not apparent, it also requires an incredible amount of software sophistication investment. In this scenario, having the highest density silicon and the best transistor is important, but not vital.
The interesting thing about all of this is that Intel in the last year has shown examples of all of this:
  • CPU- We all know Intel knows CPUs very well.
  • GPU- Hiring AMD’s Raja Koduri to build real discrete GPUs, not many core X86 chips. Intel already has the largest PC graphics share via their integrated graphics group.
  • FPGA- All things Altera, like 5G base station silicon.
  • ASIC- AVX 512, Root of Trust security, Nervana, LTE modems
  • Advanced packaging- EMIB (Embedded Multi-die Interconnect Bridge)
  • 3rd party IP- AMD Radeon graphics inside the 8th Gen Intel Core Processors with Radeon RX Vega M Graphics using EMIB
  • Software- accelerating security memory scanning with integrated GPUs
Obviously, my examples above are not comprehensive, and the company will need to make sea changes to optimize the company around this new direction. It will take moving mountains of resources which might be working on something on Friday to working on another thing a week later. Intel will likely need to acquire new skills as well and the company has started down that path, with some recent additions of top technical talent, such as AMD’s Koduri, with a proven record in graphics innovation. Today the company announced Tesla’s Jim Keller will start at the company next week. He brings 20 years of disruptive experience in x86 and ARM-based microarchitecture design across a broad range of platforms, including PCs, servers, mobile devices and cars. It’s clear they are evolving their engineering and I am hoping Intel in the near future will outline what it is doing in detail.
If I step back and assume Intel gets everything in place, I think it opens up many opportunities for the company. First off, the company would not be slowed down by the ever increasingly difficult task of shrinking geometries and delivering smaller and more efficient transistors. This is a good thing as I believe Intel has a tremendous amount of new CPU, GPU, ASIC and FPGA capabilities locked up right now in 10nm.  When you look at a SoC design with advanced packaging, you could have different IP blocks at different transistor densities which means Intel could have a better chance filling their fabs.
This could also open up doors in a new, semi-custom business where, let’s say, a company like Google would want to create their own proprietary silicon but have a complete solution that included a CPU, FPGA, memory controller, memory, IO, etc. Google could come to Intel, work with them to integrate its custom piece of silicon, and the entire SOC could be fabbed inside Intel’s fabs. This might even give Intel a leg up on manufacturing that custom piece of Google silicon in foundry operations. This should sound familiar as it is similar to what AMD is doing with Microsoft and Sony game consoles, but of course, different in that AMD fabs in GlobalFoundries and TSMC. The amount of companies looking at semi-custom designs is staggering- Google, Facebook, Tesla, Microsoft, just to name a few, are working to create their own IP or semi-custom designs. And let’s not forget about Apple. This semi-custom move could really be the driver to fill the Intel fabs with more IoT, AI, FPGA and SoC manufacturing.I believe that this is the right path, the only path, for Intel to head, to maximize its business opportunities of the ever-challenging world of smaller, faster and more efficient transistors and fab economics. It took Intel longer than I had expected to get there, but understandable given the year(s)-long historical lead it had in process tech and transistors. This will be new for Intel and require massive change and more of new and different skills, but not completely new, as it has demonstrated many of the building blocks it needs to succeed in this new world. I am looking forward to the details as they matter in situations like this.
+ posts

Patrick founded the firm based on his real-world world technology experiences with the understanding of what he wasn’t getting from analysts and consultants. Ten years later, Patrick is ranked #1 among technology industry analysts in terms of “power” (ARInsights)  in “press citations” (Apollo Research). Moorhead is a contributor at Forbes and frequently appears on CNBC. He is a broad-based analyst covering a wide variety of topics including the cloud, enterprise SaaS, collaboration, client computing, and semiconductors. He has 30 years of experience including 15 years of executive experience at high tech companies (NCR, AT&T, Compaq, now HP, and AMD) leading strategy, product management, product marketing, and corporate marketing, including three industry board appointments.