back to article Gelsinger splits Intel in two to advance foundry vision

Pat Gelsinger wants to make Intel the world's second largest chip manufacturer by 2030, and that means serving businesses the x86 giant has traditionally seen as competitors. "We want to be the foundry for the world. If we're going to be the Western foundry at scale, we can't be discriminating in who's participating in that," …

  1. Pascal Monett Silver badge

    A bold vision

    All that administrative overhead is now going to be doubled, then. With Intel HQ sitting on top.

    More minions running around, more manglement looking to seem important, and all that for a project that won't start bearing fruit before the end of this decade.

    Well, can't say Gelsinger isn't boldly going forward, at the least.

    Intel to be leading foundry in the West ? Why not ? We need something like that, at the very least.

    1. jmch Silver badge

      Re: A bold vision

      "All that administrative overhead is now going to be doubled"

      I wouldn't be so sure of that.... admin overhead doesn't really scale linearly with organisation size. Given the amount of overlapping cross-organisational communications, policies etc it might well be that it scales quadratically if not exponentially, so the overhead of 2 large organisations *might* be equivalent or less than the admin overhead for 1 gigantic one.

    2. Hiya

      Re: A bold vision

      Having worked at Intel and directly experienced working in a "carved out" business unit with walls of secrecy erected to "protect" those involved I expect that this splt will lead to a slow and painful death due to overarching processes that stiffle any progrfess. RIP Intel

      1. Peter2 Silver badge

        Re: A bold vision

        As a counter point, this was somewhat inevitable and is in no way "RIP Intel".

        At the moment, Intel's fabs have been one or two generations behind TSMC's for how long? five or six years? This has allowed AMD to keep putting the boot into Intel. Intel frankly likely would have likely lost half the market or more by now if they weren't still managing to lock AMD out of the market.

        However, this is slipping and AMD is still gaining market share. The ongoing failure to deliver the intel process map (We are at the end of a 5 year plan to deliver performance per watt leadership for Intel this year, and they haven't got it) has a painfully obvious solution; copy AMD and spin your fabs off as a separate business, buy capacity from TSMC and produce chippery on the same processes that AMD is using, removing the AMD structural advantage and basically making things a competition between design teams.

        If Intel have fabs and AMD doesn't, it also allows the strategy of Intel buying up the TSMC capacity for high value processors to reduce the amount of processors AMD can fab by outbidding them and therefore further limiting their market share while then fabbing everything but the latest stuff on Intels less advanced fabs.

        Now since this is an obvious contingency plan for Intels fabs not keeping to their schedule this tells you a lot more about how things are going internally and their managements opinion on how possible sorting their own fabs are rather than rosy press releases.

      2. ecofeco Silver badge

        Re: A bold vision

        Well that's pretty much any large corporation these days.

        "Silo-ing" has been the crippling reason for the fall of many great corporations. Some from their top spot, some all the way to oblivion.

  2. Phil the Geek

    Been done before

    The first steps down the Boeing / Spirit road to devolved manufacturing. What could possibly go wrong?

    1. katrinab Silver badge

      Re: Been done before

      Or the AMD/Global Foundries road to two separate companies?

      Plenty went wrong for Global Foundries, but it was probably going to happen regardless, and the split means AMD is insulated from it.

  3. Grunchy Silver badge

    OMG sounds like something Sanders did with AMD, like 15 years ago.

  4. Tim99 Silver badge

    Shareholder value?

    Split, strip, and dump?

  5. luis river

    Sharp question

    Question to resolve: Split in two complety separate companies to compete, or create a subsidiary company with great underground connetion ?

  6. Spunbearing

    Historic context of Intel's ability to work with others' IP and trade secrets:

    New York Times, 1997:

    "The Digital Equipment Corp. stunned the computer industry and Wall Street Tuesday by filing a lawsuit contending that the Intel Corp. stole some of its patented chip designs to create the popular Pentium microprocessors, the key component in more than 85 percent of the world's personal computers.

    In a remarkable suit between an industry star of the present and one of the past, Digital Equipment asked the court to order Intel to stop using Digital technology in its products and demanded triple damages for Intel's "willful infringement" of 10 Digital patents."

    "Palmer said Tuesday that Digital offered to license the Alpha chip to Intel in 1991 when Intel was looking to improve the performance of its chips. He said that Intel looked carefully at Alpha before deciding not to use the chip.

    When Intel introduced its Pentium Pro chip in November 1995, Palmer said he was surprised by the new chip's substantial increase in performance. His suspicions grew last August, he said, when Andrew S. Grove, Intel's chief executive, and Craig Barrett, its chief operating officer, seemed to admit in an article in The Wall Street Journal that Intel took its chip designs from others."

    I'm sure they will be better this time. I'm sure they have been better since learning that lesson and compete on merit. It's not like they are cheating on benchmarks or strong arming partners. Oh wait...

    1. ecofeco Silver badge

      I'm shocked their is corporate espionage in this establishments! Sergeant, round up of the usual suspects!

  7. JohnDyson

    I have seen this before in big companies. Possibly the first step to a total divorce, a very big example would be AT&T and Lucent. I was at AT&T Bell Labs when it happened, and could see the separation causing more and more bureaucracy needed to work 'across the border'. Part of the goal was to make sure that the projects were separated before the big split. I had a project fail (at the exec VP decision level) because of the need for microelectronics technology from Lucent for a big project while working in the Labs. In earlier days, there would have been no separation.

    Lets see what happens to Intel... Might be interesting over the next 5yrs.

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