Intel's Strategy Driven by Convergence

January 17, 2005

This announcement from this morning emphasizes the continuing ability of Intel to reshape itself according to market directions and trends:

Intel Aligns Around Platforms

For a company approaching the age of 40, the natural concern might be whether they have grown too big, lost their ability to envision and innovate, and allowed themselves to get overtaken by more nimble competitors. Not a problem yet for Intel, I think. The reorganization indicates that the company is still asking itself the right questions: What do we do, and who do we do it for?

Here are Intel's new business units, set up to bring the right product groups together to address market needs:

1. The Mobility Group -- "will develop platforms for notebook PCs and handheld computing and communications devices, and is aimed at making the growing numbers of different mobile devices work together better and easier to use. "

2. The Digital Enterprise Group -- "will develop computing and communications infrastructure platforms for end-to-end solutions in businesses."

3. The Digital Home Group (see my article from 12/30/04, "Intel's Vision for the Digital Home") -- "will develop computing and communications platforms for use by consumers in the emerging digital home, with emphasis on living room entertainment applications and consumer electronics devices. "

4. The Digital Health Group -- "will develop products and explore business opportunities for Intel architecture products in healthcare research, diagnostics and productivity, as well as personal healthcare."

5. The Channel Products Group -- "will seek to expand on Intel's success in global markets by combining into one organization existing groups focused on developing and selling Intel products to meet the unique needs of local markets worldwide."

Intel is conceptualizing these product groups as "platform-based organizations" that "reflect the ongoing convergence of computing and communications."

It will be interesting to observe how this realignment affects Intel's product development and marketing efforts in the next couple of years.

AB -- 1/17/05