Intel

Intel Corporation (NASDAQ: INTC) is an American multinational technology corporation headquartered in Santa Clara, California, United States and the world's largest semiconductor chip maker, based on revenue. It is the inventor of the x86 series of microprocessors, the processors found in most personal computers. Intel was founded on July 18, 1968, as Integrated Electronics Corporation (though a common misconception is that "Intel" is from the word intelligence). Intel also makes motherboard chipsets, network interface controllers and integrated circuits, flash memory, graphic chips, embedded processors and other devices related to communications and computing. Founded by semiconductor pioneers Robert Noyce and Gordon Moore and widely associated with the executive leadership and vision of Andrew Grove, Intel combines advanced chip design capability with a leadingedge manufacturing capability. Though Intel was originally known primarily to engineers and technologists, its "Intel Inside" advertising campaign of the 1990s made it and its Pentium processor household names. Intel was an early developer of SRAM and DRAM memory chips, and this represented the majority of its business until 1981. While Intel created the first commercial microprocessor chip in 1971, it was not until the success of the personal computer (PC) that this became its primary business. During the 1990s, Intel invested heavily in new microprocessor designs fostering the rapid growth of the computer industry. During this period Intel became the dominant supplier of microprocessors for PCs, and was known for aggressive and sometimes illegal tactics in defense of its market position, particularly against Advanced Micro Devices (AMD), as well as a struggle with Microsoft for control over the direction of the PC industry. The 2010 rankings of the world's 100 most powerful brands published by Millward Brown Optimor showed the company's brand value at number 48. Intel has also begun research in electrical transmission and generation. Intel has recently introduced a 3D transistor that may improve performance and energy efficiency. Intel will be mass producing this 3-D transistor, called Tri-Gate transistors, with their upcoming 22nm process in the near future. In 2011, SpectraWatt Inc., a solar cell spinoff of Intel, filed for bankruptcy under Chapter 11.

Corporate history
Origins
Intel headquarters in Santa Clara, CA, USA

Intel was founded in Mountain View, California in 1968 by Gordon E. Moore (of "Moore's Law" fame, a chemist and physicist), Robert Noyce (a physicist and co-

inventor of the integrated circuit), and Arthur Rock (investor and venture capitalist). Moore and Noyce had both come from Fairchild Semiconductor were the first two employees, and Arthur was an investor only (not an employee), but was Chairman of the Board.
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The total initial investment in Intel was $2.5

million convertible debentures and $10,000 from Rock. Just 2 years later, Intel completes their initial public offering (IPO) raising $6.8 million ($23.50 per share). Intel's third employee was Andy Grove, a chemical engineer, who later ran the company through much of the 1980s and the high-growth 1990s. Moore and Noyce initially wanted to name the company "Moore Noyce". The name, however, was a homophone for "more noise" an ill-suited name for an electronics company, since noise in electronics is usually very undesirable and typically associated with bad interference. Instead they used the name NM Electronics for almost a year, before deciding to call their company IntegratedElectronics or "Intel" for short. Since "Intel" was already trademarked by the hotel chain Intelco, they had to buy the rights for the name.

Early history
At its founding, Intel was distinguished outstandingly by its ability to make semiconductors and its first product in 1969 was the 3101 Schottky bipolar random access memory (RAM). That same year Intel produced the first metal oxide semiconductor (MOS) static random access memory (SRAM) chips. Intel's business grew during the 1970s as it expanded and improved its manufacturing processes and produced a wider range of products, still dominated by various memory devices. While Intel created the first commercially available microprocessor (Intel 4004) in 1971 and one of the first microcomputers in 1972, by the early 1980s its business was dominated by dynamic random access memory chips. However, increased competition from Japanese semiconductor manufacturers had, by 1983, dramatically reduced the profitability of this market, and the sudden success of the IBM personal computer convinced then-CEO Andrew Grove to shift the company's focus to microprocessors, and to change fundamental aspects of that business model. By the end of the 1980s this decision had proven successful. Buoyed by its fortuitous position as microprocessor supplier to IBM and its competitors within the rapidly growing personal computer market, Intel embarked on a 10-year period of unprecedented growth as the primary (and most profitable) hardware supplier to the PC industry. By launching its Intel Inside marketing campaign in 1991, Intel was able to associate brand loyalty with consumer selection, so that by the end of the 1990s, its line of Pentium processors had become a household name.

Slowing demand and challenges to dominance

After 2000, growth in demand for high-end microprocessors slowed. Competitors, notably AMD (Intel's largest competitor in its primary x86 architecture market), garnered significant market share, initially in low-end and mid-range processors but ultimately across the product range, and Intel's dominant position

in its core market was greatly reduced. In the early 2000s then-CEO Craig Barrett attempted to diversify the company's business beyond semiconductors, but few of these activities were ultimately successful. Intel had also for a number of years been embroiled in litigation. US law did not initially recognize intellectual property rights related to microprocessor topology (circuit layouts), until the Semiconductor Chip Protection Act of 1984, a law sought by Intel and the Semiconductor Industry Association (SIA). During the late 1980s and 1990s (after this law was passed) Intel also sued companies that tried to develop competitor chips to the 80386 CPU. The lawsuits were noted to significantly burden the competition with legal bills, even if Intel lost the suits. Antitrust allegations that had been simmering since the early 1990s and already been the cause of one lawsuit against Intel in 1991, broke out again as AMD brought further claims against Intel related to unfair competition in 2004, and again in 2005. In 2005, CEO Paul Otellini reorganized the company to refocus its core processor and chipset business on platforms (enterprise, digital home, digital health, and mobility) which led to the hiring of over 20,000 new employees. In September 2006 due to falling profits, the company announced a restructuring that resulted in layoffs of 10,500 employees or about 10 percent of its workforce by July 2006.

Regaining of momentum
Faced with the need to regain lost marketplace momentum, Intel unveiled its new product development model to regain its prior technological lead. Known as its "tick-tock model", the program was based upon annual alternation ofmicroarchitecture innovation and process innovation. In 2006, Intel produced P6 and NetBurst products with reduced die size (65 nm). A year later it unveiled its Core microarchitecture to widespread critical acclaim; the product range was perceived as an exceptional leap in processor performance that at a stroke regained much of its leadership of the field. In 2008, we saw another "tick", Intel introduced the Penryn microarchitecture, undergoing a shrink from 65 nm to 45 nm, and the year after saw the release of its positively reviewed successor processor, Nehalem, followed by another silicon shrink to the 32nm process. Intel was not the first microprocessor corporation to do this. For example, around 1996 graphics chip designers nVidia had addressed its own business and marketplace difficulties by adopting a demanding 6-month internal product cycle whose products repeatedly outperformed market expectation.

Sale of XScale processor business

On June 27, 2006, the sale of Intel's XScale assets was announced. Intel agreed to sell the XScale processor business to Marvell Technology Group for an estimated $600 million (They bought them for $1.6billion) in cash and the assumption of unspecified liabilities. The move was intended to permit Intel to focus its resources on its core x86 and server businesses, and the acquisition completed on November 9, 2006.

Acquisitions
In August 2010, Intel announced two major acquisitions. On August 19, Intel announced that it planned to purchase McAfee, a manufacturer of computer security technology. The purchase price was $7.68 billion, and the companies said that if the deal were approved, new products would be released early in 2011. Less than two weeks later, the company announced the acquisition of Infineon Technologies Wireless Solutions business. With the Infineon transaction, Intel plans to use the companys technology in laptops, smart phones, netbooks, tablets and embedded computers in consumer products, eventually integrating its wireless modem into Intels silicon chips. Intel won the European Union regulatory approval for its acquisition of McAfee on January 26, 2011. Intel agreed to ensure that rival security firms have access to all necessary information that would allow their products to use Intel's chips and personal computers. Following the closure of the McAfee deal, Intel's workforce totals approximately 90,000, including (roughly) 12,000 software engineers. In March 2011, Intel bought most of the assets of Cairo-based SySDSoft. In July 2011, Intel announced that it has agreed to acquire Fulcrum Microsystems Inc., a company specializing in network switches. The company was previously included on EE Times list of 60 Emerging Startups.

Expansions
In 2008, Intel spun off key assets of a solar startup business effort to form an independent company, SpetraWatt Inc. However, as of 2011, SpectraWatt has filed for bankruptcy. February 2011: The company will build a new microprocessor factory at Chandler, Arizona which is expected to be completed in 2013 at a cost of $5 billion. It will accommodate 4,000 employees. The company produces three quarters of their products in the United States, although three quarters of the revenue come from overseas. April 2011: Intel Corporation began a pilot project to produce smartphones with ZTE Corporation for China's domestic market. This project is intended to challenge the domination of ARM processors in mobile phones. The smartphone will be based on the Intel Atom processor.

Product and market history

SRAMS and the microprocessor
The company's first products were shift register memory and random-access memory integrated circuits, and Intel grew to be a leader in the fiercely competitive DRAM, SRAM, and ROM markets throughout the 1970s. Concurrently, Intel engineers Marcian Hoff, Federico Faggin, Stanley Mazor and Masatoshi Shima invented Intel's first microprocessor. Originally developed for the Japanese company Busicom to

replace a number of ASICs in a calculator already produced by Busicom, the Intel 4004 was introduced to the mass market on November 15, 1971, though the microprocessor did not become the core of Intel's business until the mid-1980s. (Note: Intel is usually given credit with Texas Instruments for the almostsimultaneous invention of the microprocessor.)

From DRAM to microprocessors

In 1983, at the dawn of the personal computer era, Intel's profits came under increased pressure from Japanese memory-chip manufacturers, and then-President Andy Grove drove the company into a focus on microprocessors. Grove described this transition in the book Only the Paranoid Survive. A key element of his plan was the notion, then considered radical, of becoming the single source for successors to the popular 8086 microprocessor. Until then, manufacture of complex integrated circuits was not reliable enough for customers to depend on a single supplier, but Grove began producing processors in three geographically distinct factories, and ceased licensing the chip designs to competitors such as Zilog and AMD. When the PC industry boomed in the late 1980s and 1990s, Intel was one of the primary beneficiaries.

Intel, x86 processors, and the IBM PC

The die from an Intel 8742, an 8-bit microcontroller that includes a CPU running at 12 MHz, 128 bytes of RAM, 2048 bytes of EPROM, and I/O in the same chip.

Despite the ultimate importance of the microprocessor, the 4004 and its successors the 8008 and the 8080 were never major revenue contributors at Intel. As the next processor, the 8086 (and its variant the 8088) was completed in 1978, Intel embarked on a major marketing and sales campaign for that chip nicknamed "Operation Crush", and intended to win as many customers for the processor as possible. One design win was the newly created IBM PC division, though the importance of this was not fully realized at the time. IBM introduced its personal computer in 1981, and it was rapidly successful. In 1982, Intel created the 80286 microprocessor, which, two years later, was used in the IBM PC/AT. Compaq, the first IBM PC "clone" manufacturer, produced a desktop system based on the faster 80286 processor in 1985 and in 1986 quickly followed with the first 80386-based system, beating IBM and establishing a competitive market for PC-compatible systems and setting up Intel as a key component supplier. In 1975 the company had started a project to develop a highly advanced 32-bit microprocessor, finally released in 1981 as the Intel iAPX 432. The project was too ambitious and the processor was never able to meet its performance objectives, and it failed in the marketplace. Intel extended the x86 architecture to 32 bits instead.

386 microprocessor
During this period Andrew Grove dramatically redirected the company, closing much of its DRAM business and directing resources to the microprocessor business. Of perhaps greater importance was his decision to "single-source" the 386 microprocessor. Prior to this, microprocessor manufacturing was in its infancy, and manufacturing problems frequently reduced or stopped production, interrupting supplies to customers. To mitigate this risk, these customers typically insisted that multiple manufacturers produce chips they could use to ensure a consistent supply. The 8080 and 8086-series microprocessors were produced by several companies, notably AMD. Grove made the decision not to license the 386 design to other manufacturers, instead producing it in three geographically distinct factories in Santa Clara, California; Hillsboro, Oregon; and the Phoenix, Arizona suburb of Chandler; and convincing customers that this would ensure consistent delivery. As the success of Compaq's Deskpro 386 established the 386 as the dominant CPU choice, Intel achieved a position of near-exclusive dominance as its supplier. Profits from this funded rapid development of both higher-performance chip designs and higher-performance manufacturing capabilities, propelling Intel to a position of unquestioned leadership by the early 1990s.

486, Pentium, and Itanium

Intel introduced the 486 microprocessor in 1989, and in 1990 formally established a second design team, designing the processors code-named "P5" and "P6" in parallel and committing to a major new processor every two years, versus the four or more years such designs had previously taken. The P5 was earlier known as "Operation Bicycle" referring to the cycles of the processor. The P5 was introduced in 1993 as the Intel Pentium, substituting a registered trademark name for the former part number (numbers, such as 486, are hard to register as a trademark). The P6 followed in 1995 as the Pentium Pro and improved into the Pentium II in 1997. New architectures were developed alternately in Santa Clara, California and Hillsboro, Oregon.

The Santa Clara design team embarked in 1993 on a successor to the x86 architecture, codenamed "P7". The first attempt was dropped a year later, but quickly revived in a cooperative program with Hewlett-Packard engineers, though Intel soon took over primary design responsibility. The resulting implementation of the IA-64 64-bit architecture was the Itanium, finally introduced in June 2001. The Itanium's performance running legacy x86 code did not achieve expectations, and it failed to compete effectively with 64-bit extensions to the original x86 architecture, introduced by AMD, named x86-64 (although Intel uses the name Intel 64, previously EM64T). As of 2009, Intel continues to develop and deploy the Itanium.

The Hillsboro team designed the Willamette processors (code-named P67 and P68) which were marketed as the Pentium 4. In June 2011, Intel will introduce the first Pentium mobile processor, based on Sandy Bridge core. The B940, clocked at 2 GHz, is faster than existing or upcoming mobile Celerons, although it is almost identical to dual-core Celeron CPUs in all other aspects.

Pentium flaw
In June 1994, Intel engineers discovered a flaw in the floating-point math subsection of the P5 Pentium microprocessor. Under certain data dependent conditions, low order bits of the result of floating-point division operations would be incorrect, an error that can quickly compound in floating-point operations to much larger errors in subsequent calculations. Intel corrected the error in a future chip revision, but nonetheless declined to disclose it. In October 1994, Dr. Thomas Nicely, Professor of Mathematics at Lynchburg College independently discovered the bug, and upon receiving no response from his inquiry to Intel, on October 30 posted a message on the Internet. Word of the bug spread quickly on the Internet and then to the industry press. Because the bug was easy to replicate by an average user (there was a sequence of numbers one could enter into the OS calculator to show the error), Intel's statements that it was minor and "not even an erratum" were not accepted by many computer users. During Thanksgiving 1994, The New York Times ran a piece by journalist John Markoff spotlighting the error. Intel changed its position and offered to replace every chip, quickly putting in place a large end-user support organization. This resulted in a $500 million charge against Intel's 1994 revenue. Ironically, the "Pentium flaw" incident, Intel's response to it, and the surrounding media coverage propelled Intel from being a technology supplier generally unknown to most computer users to a household name. Dovetailing with an uptick in the "Intel Inside" campaign, the episode is considered to have been a positive event for Intel, changing some of its business practices to be more end-user focused and generating substantial public awareness, while avoiding a lasting negative impression.

"Intel Inside" and other 1990s programs

During this period, Intel undertook two major supporting programs. The first is widely known: the 1991 "Intel Inside" marketing and branding campaign. The idea of ingredient branding was new at the time with only Nutrasweet and a few others making attempts at that. This campaign established Intel, which had been a component supplier little-known outside the PC industry, as a household name. The second program is little-known: Intel's Systems Group began, in the early 1990s, manufacturing PC "motherboards", the main board component of a personal computer, and the one into which the processor (CPU) and memory (RAM) chips are plugged. Shortly after, Intel began manufacturing fully configured "white box" systems for the dozens of PC clone companies that rapidly sprang up. At its peak in the mid1990s, Intel manufactured over 15% of all PCs, making it the third-largest supplier at the time.

During the 1990s, Intel's Architecture Lab (IAL) was responsible for many of the hardware innovations of the personal computer, including the PCI Bus, the PCI Express (PCIe) bus, the Universal Serial Bus (USB), Bluetooth wireless interconnect, and the now-dominant architecture for multiprocessor servers. IAL's software efforts met with a more mixed fate; its video and graphics software was important in the development of software digital video, but later its efforts were largely overshadowed by competition from Microsoft. The competition between Intel and Microsoft was revealed in testimony by IAL Vice-President Steven McGeady at the Microsoft antitrust trial.

Solid-state drives (SSD)

On September 8, 2008, Intel began shipping its first mainstream solid-state drives, the X18-M and X25-M with 80GB and 160GB storage capacities. These MLC-based drives received wide critical acclaim for their superior performance. Intel released their SLC-based Enterprise X25-E Extreme SSDs on October 15 that same year in capacities of 32GB and 64GB. In July 2009, Intel refreshed their X25-M and X18-M lines by moving from a 50-nanometer to a 34nanometer process. These new drives, dubbed by the press as the X25-M and X18-M G2 (or generation 2), reduced prices by up to 60 percent while offering lower latency and improved performance. On February 1, 2010, Intel and Micron announced that they were gearing up for production of NAND flash memory using a new 25-nanometer process. In March of that same year, Intel entered the budget SSD segment with their X25-V drives with an initial capacity of 40GB. The SSD 310, Intel's first mSATA drive was released on December 2010, providing X25-M G2 performance in a much smaller package. March 2011 saw the introduction of two new SSD lines from Intel. The first, the SSD 510, uses a SATA 6 Gigabit per second interface in order to reach speeds of up to 500 MegaBytes per second. The drive, which uses a controller from Marvell, was released using 34 nm NAND Flash and came in capacities of 120GB and 250GB. The second product announcement, the SSD 320, is the successor to Intel's earlier X25-M. It uses the new 25 nm process that Intel and Micron announced in 2010, and was released in capacities of 40 GB, 80 GB, 120 GB, 160 GB, 300 GB and 600 GB. Sequential read performance maxes out at 270 MB/s due to the older SATA 3 Gbit/s interface, and sequential write performance varies greatly based on the size of the drive with sequential write performance of the 40 GB model peaking at 45 MB/s and the 600 GB at 220 MB/s. Micron and Intel announced that they were producing their first 20 nm MLC NAND flash on April 14, 2011.

Supercomputers
The Intel Scientific Computers division was founded in 1984 by Justin Rattner, in order to design and produce parallel computers based on Intel microprocessors connected in hypercube topologies.
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In

1992 the name was changed to the Intel Supercomputing Systems Division, and development of the iWarp architecture was also subsumed. The division designed several supercomputer systems,

including the Intel iPSC/1, iPSC/2, iPSC/860, Paragon and ASCI Red.

Partnership with Apple

On June 6, 2005, Apple CEO Steve Jobs announced that Apple would be transitioning from its long favored PowerPC architecture to the Intel x86 architecture, because the future PowerPC road map was unable to satisfy Apple's needs. The first Macintosh computers containing Intel CPUs were announced on January 10, 2006, and Apple had its entire line of consumer Macs running on Intel processors by early August 2006. The Apple Xserve server was updated to Intel Xeonprocessors from November 2006, and was offered in a configuration similar to Apple's Mac Pro.

Core 2 Duo advertisement controversy

In 2007, the company released a print advertisement for its Core 2 Duo processor featuring six African American runners appearing to bow down to a Caucasian male inside of an office setting (due to the posture taken by runners on starting blocks). According to Nancy Bhagat, Vice President of Intel Corporate Marketing, the general public found the ad to be "insensitive and insulting." The campaign was quickly pulled and several Intel executives made public apologies on the corporate website.

Mobile processor
In March 2011, Intel introduced the first, and so far the only one, mobile Celeron processor with Sandy Bridge core. Intel planned to introduce Medfield a processor for tablets and smartphones to the market in 2012, as an effort to compete with ARM. As a 32-nanometer processor, Medfield is designed to be energy-efficient, which is one of the core features in ARMs chips.

Advertising and brand management

Intel Inside
Intel has become one of the world's most recognizable computer brands following its long-running Intel Inside campaign. The campaign, which started in 1991, was created by Intel marketing manager Dennis Carter. The five-note jingle was introduced the following year and by its tenth anniversary was being heard in 130 countries around the world. The initial branding agency for the Intel Inside campaign was DahlinSmithWhite Advertising of Salt Lake City. The Intel swirllogo was the work of DahlinSmithWhite art director Steve Grigg under the direction of Intel president and CEO Andy Grove. The Intel Inside advertising campaign sought public brand loyalty and awareness of Intel processors in consumer computers. Intel paid some of the advertiser's costs for an ad that used the Intel Inside logo and jingle. In 2008, Intel planned to shift the emphasis of its Intel Inside campaign from traditional media such as television and print to newer media such as the Internet. Intel required that a minimum of 35% of the money it provided to the companies in its co-op program be used for online marketing. The Intel 2010

annual financial report indicated that $1.8 billion (6% of the gross margin and nearly 16% of the total net income) was allocated to all advertising with Intel Inside being part of that.

Logos
Corporate Logo Date Intel Inside Logo Date

1991 2003

1968 2005

2003 2005

2006 2009

2005 present

2009 2011

2011 present