Chip giant Intel Corp. went back to the future in a reorg last week that effectively returned the company's ambitions in communications silicon to about 1998. Tucking its wireless and wired comms business units inside the more traditional and successful notebook and server groups, Intel once again looks like a PC giant dabbling in related comms businesses.
It didn't used to be that way. In a string of acquisitions through the dot-com boom, Intel raced to stake out a full portfolio of processors serving everything from cell phones to central-office routers. At the time, ambitions ran so high that Intel even set up its own server farms for Internet outsourcing, drunk with the concept of becoming its own biggest user.
There's nothing wrong with thinking big. But it is important to learn the true lessons of history.
Intel ends its multibillion-dollar comms spree with a few small jewels a growing network processor business estimated at about $30 million, a stake in optical modules and a shot at being a supplier of smart-phone CPUs with its Xscale.
In today's more modest environment, these pieces all represent decidedly moderate hopes for growth in big market-oriented business units, and president Paul Otellini will be tracking the performance of these division managers closely.
In a side bet, Otellini's reorg created a new unit aimed at opportunities in the health industry. Wisely, Intel put off discussing that group's goals for a month or two while it soberly analyzes this emerging market.
Rick Merritt is editor at-large for EE Times. He can be reached at email@example.com.