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Intel Clears Up Post-Tejas Confusion

Intel yesterday revealed that it will revamp its microprocessor lineup to emphasize multi-core chips, which place two or more central processing units on a single semiconductor die. The news was disclosed at the company's annual spring analyst meeting before the financial community in New York City.

"All of our microprocessor development going forward is multi-core," said Paul Otellini, Intel's president and chief operating officer. "We'll add multi-core products into all our products in volume in 2005. We think that in 2006, over half of all clients -- [both] notebooks and desktops -- will be multi-core. And servers will essentially all be multi-core."

Intel's announcement should put to rest the confusion about its roadmap that has been rising in the wake of the company's recent cancellation of its Tejas processor. That chip, planned as a successor to the Pentium 4-class Prescott processor, was purportedly put on hold because it would have drawn in the range of 100 watts (W) of power. Power has emerged as an industrywide issue because processors draw more ampere as they are pushed to multi-gigahertz clock speeds, eating up wattage and becoming difficult to cool with conventional heat-sink technology.

Intel didn't specifically comment on Tejas's power issue, but Otellini confirmed that "thermal considerations" were at the root of what he called " a hard right-hand turn" in the company's roadmap.

"If we had not started making this right-hand turn, we would have run into a power wall," Otellini said. "You just can't ship desktop processors at 150 W."

Though Intel is adopting multi-core as an end-around to the power problem, Otellini pointed out it delivers a positive in its own right. Namely, the placement of two separate microprocessors on a single chip enables computers "to parallelize existing tasks or to divide up multiple tasks." For example, operating systems on PCs built around multi-cores will be able to divvy up tasks such as the user interface, security or the decoding of high-definition video streams to separate cores.

Intel thinks its chip strategy will also be marketable with Microsoft's next-generation operating system, due in 2006. "As Longhorn comes in, we believe the user experience on a multi-core machine will be much better than on a single core machine," Otellini said.

However, one product Intel won't be emphasizing for the client PC space is a full 64-bit chip. Company officials made clear at yesterday's briefing that Intel's existing Itanium 2 processor, aimed at the high-end server market, or what it calls the "mainframe replacement" segment, will remain its only entry with both 64-bit addressing and data.

Intel will offer a 32/64-bit hybrid version of its Xeon processor, with 64-bit addressing and Intel's 64-bit instruction-set extensions. The hybrid Xeon, which is targeted at entry-level servers, is Intel's response to AMD's highly successful 32/64-bit Opteron.

Plans by IBM, Hewlett-Packard and Sun Microsystems to offer Opteron servers have made Intel take notice. "It raises our competitive juices to go win that business back," Otellini said. "That's one reason you're seeing an acceleration of our roadmap, not just in Itanium, but in 32-bits."

Intel should be able to mount a potent comeback, according to one analyst. "This is something Intel cannot back down on," said Janet Ramkissoon, principal at Quadra Capital, New York. "They will respond with multi-core devices with 64-bits and special features like hyperthreading, so we will end up with these super microprocessors."

As for the desktop, Intel disclosed that it's building the capability for its 64-bit extensions into its upcoming Prescott processor. However, Intel said it won't enable the feature until Microsoft has validated a 64-bit version of Windows for Prescott. That's expected to happen later this year.

Though Prescott will then become a hybrid 32/64 device, Intel said it has no plans to field a full-fledged 64-bit desktop chip further down the road. "We think that not every register inside the machine needs to go to 64 bits, nor do we intend to do that anytime soon," Otellini said. "I don't think that [64-bits] is the big story here. The big story is the move to multi-core."

More important, Otellini gainsayed suggestions that Prescott could become a victim of Intel's roadmap revision. "There's been some speculation that Prescott may [go] end-of-line with the cancellation of Tejas," he said. "Let me assured you that nothing could be further from the truth."

Turning to systems-level considerations, Intel said at yesterday's briefing that it will help VARs make hay out of the burgeoning laptop market by placing a renewed emphasis on its "whitebook" program, first laid out about a year ago.

"The standardization of components in that area is going to make the whitebook market bigger," said Intel CEO Craig Barrett.

Whitebooks, the notebook equivalent of "white box" desktop machines, are seen as a particularly robust market by Intel. The company projects sales of 227 million wireless-equipped notebooks between 2004 and 2007. Further out, Intel forecasts that 30 percent of all PCs sold in 2008 will be notebooks.

On the broader VAR front, Intel sees particular strength in emerging markets such as China, Russia, and India. "We're putting more and more of our channel development funds into creating channel infrastructure in emerging markets," Barrett said. Most of that investment is funneled into creating an infrastructure for small-systems integrators, including advertising and building a physical presence.

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