Intel Sees Market for PCs Stabilizing This Year

Tagged: intel i7, Computer Hardware
Source: WSJ - Read the full article
Posted: 4 years 47 weeks ago

Intel Corp.'s chief executive said he expects PC unit sales for the year will end their declines and be "flat to slightly" up.

"I think [the PC industry] is more than resilient, it's amazing," said Paul Otellini, who spoke at Intel's annual forum for technology developers here.

This year's Intel Developer Forum follows an industry slump that hit bottom in last year's fourth quarter and has gradually eased since then. Mr. Otellini noted that many forecasters had originally expected a big drop in unit personal-computer sales for 2009, and most still call for a slight decline.

Intel used the forum to announce an effort to help chip customers set up their own clearinghouses to distribute programs for a variety of gadgets as part of its strategy to promote the use of its chips outside computer markets.

The effort is designed to broaden the appeal of an Intel chip called Atom that is now mainly used in low-end laptops called netbooks.

Intel, extending an idea that Apple Inc. popularized with software for the iPhone, hopes developers will create simple, downloaded apps -- likely starting with netbooks, but later for cellphones, consumer-electronics devices and other Atom-based products.

Intel doesn't plan to operate app stores itself, but will provide what it calls a technology framework to help Atom customers to set up their own.

Software is a key element of Intel's strategy to tackle new markets such as cellphones, where rivals that license microprocessor designs from ARM Holdings PLC dominate the field.

Intel contends its new effort, called the Atom Developer Program, will ensure that applications will run on cellphones from multiple manufacturers and work on other kinds of devices.

"I think we will break down barriers between industries," Mr. Otellini said, during his keynote speech at the forum.

One unusual wrinkle is Intel's plan to make it easier for apps -- which are normally targeted at a single operating system -- to run on Atom-based devices that use either Microsoft Corp.'s Windows or an Intel-backed operating system known as Moblin. Microsoft said it will assist by adapting its Silverlight software -- which adds video and animation to Web sites -- to work with Moblin. Rival Adobe Systems Inc., which makes the popular Flash format, also expressed support for the Intel effort.

Dell Inc., Acer Inc. and Asustek Computer Inc. also said they plan to adopt the Intel app-store approach.

Analysts said Intel's effort makes sense, but the company still faces an uphill battle. ARM has made progress in ensuring compatibility between products that use its latest chips. And ARM-based chips still offer longer battery life than Intel's Atom, noted Roger Kay, an analyst at Endpoint Technologies Associates.

The Intel event comes one day after the European Union released a large number of emails and other evidence to support its decision in May to fine Intel €1.06 billion ($1.56 billion). Mr. Otellini said EU investigators ignored evidence that would have undercut allegations that Intel punishes PC makers that use chips from rival Advanced Micro Devices Inc.

"We don't do exclusive deals, despite what you read and what you heard," Mr. Otellini said.

Intel also discussed its advances in manufacturing technology. The company is now processing silicon wafers that will yield the first commercial chips based on lines of circuitry measured at 32 nanometers, or billionths of a meter, an advance over the 45 nanometer chips it now uses. Shrinking the transistors on chips boosts their performance and data storage capacity and lowers their manufacturing costs.

In addition, Mr. Otellini showed a silicon wafer featuring what he said are the world's first working chips built using the next-generation production process, rated at 22 nanometers.