Otellini Outlines Opportunities In Chip Market At Intel Developer Forum

That was the message Intel president and COO Paul Otellini outlined in his opening keynote speech at the Intel Developer Forum in San Francisco on Tuesday. The biannual event is hosting about 5,500 hardware and software developers, media and Intel vendor partners, showcasing the latest developments in processors and related technologies.

Otellini stuck primarily to the bird's-eye view during his presentation, alluding only briefly to an announcement the company made this morning and entirely avoiding any discussion of the beating Intel's stock price took last week. The setback occurred after the company lowered its third-quarter revenue projections because of factors such as lower-than-expected demand for processors.

The day's main product announcement was for its upcoming wireless component, code-named Rosedale, which is expected to be the first "system-on-a-chip" design that supports IEEE 802.16-2004 (previously known as IEEE 802.16REVd and better known as WiMAX). Intel has begun sending sample Rosedale product to key customers, and WiMAX Forum, an industry group chartered to test and certify interoperability among WiMAX products, is expected to hold initial interoperability testing and certification programs in 2005.

Intel's financial bad news didn't deter Otellini from presenting a chart that shows a rebound in the overall semiconductor market, which dived steeply after the Internet bubble burst four years ago but has rebounded back to the level it was in 2000.

"After three long, hard years, we saw growth return to the marketplace, and in 2004 we should see a new peak in overall numbers of microprocessors sold, and a similar pattern is emerging in communications silicon," he said.

Otellini says the comeback is happening because the promise of convergence is finally being realized, the "digital effect" of more types of information being digitized is under way and new markets are emerging around expanding economies in developing nations.

Of these factors, convergence of voice and data networks is the one most immediately responsible for the apparent upturn.

"This year will be the first time data-enabled phones will outship voice-only handsets," Otellini said. "It makes voice free and data a critical linchpin going forward. It means we can start thinking of new technology thresholds."

It also means that while Moore's Law is still in effect, it's changing with the times.

"As it continues to drive GHz performance, it also adds capabilities into the processor," he said. "We're now able to add features such as PCI Expansion and high-definition capabilities around the processor, as well as the ability to manage all the new technologies."

Otellini said this will enable Intel's plan for the Digital Home to become reality. The company and its partners settled on a technology specification for home networks in June and expect to have products ready by this holiday season.

Otellini says further expansion between now and the end of the decade will revolve around the adoption of wireless broadband -- Wi-Fi-enabled notebooks will go from 10 percent of units shipped in 2003 to more than 90 percent next year -- and parallelism, which is a sort of turbo-multitasking functionality that relies on multicore processors that will enable capabilities like better user interfaces, virus and security protection, and overall improved efficiency and performance.

This will let desktop users recognize, mine and synthesize their data in a way that's currently only possible with sophisticated applications on big servers.

"Think of it as 'googling' with video capabilities on your desktop," Otellini said. "To be able to bring this to everyone's computer, we'll need a 10x performance increase."

Otellini demonstrated the next generation Intel Itanium processor, code-named Montecito, which has a multicore design and more than 1.7 billion transistors and 24 MB of cache memory.

"We're now moving from how many chips can you fit into a computer to how many computers you can fit on a chip," he said.

The company also is developing Intel Active Management Technology (IAMT), which is designed to manage information across a variety of platforms, from handheld communications devices to servers; virtualization technology, code-named Vanderpool Technology, or VT, which will allow computers to run multiple operating environments simultaneously and reduce reliability issues; and LaGrande Technology (LT), a security tool that will help prevent hackers from accessing office and personal information.