Scalability from datacenter to IoT: Q&A with Intel

Scalability from datacenter to IoT: Q&A with Intel

Ricky Morris, DIGITIMES, Taipei [Tuesday 3 June 2014]

Intel was one of the main driving forces behind the consumer PC era of desktops and notebooks, but the trend in recent years towards low-power devices such as tablets, wearables and IoT applications has forced the company to re-evaluate its development process to become more open and agile.

Digitimes recently sat down with Jason Chen, Vice President, Sales and Marketing Group and Country Manager, Intel Taiwan, to discuss the company’s plans for Computex 2014, the changing roles of Taiwan and China in the IT industry supply chain, how Intel is evolving to address the needs of the smart-device revolution.

Q: Would you like to start by introducing Intel’s plans for Computex?

A: This year our new president Renee James will present a keynote in the afternoon of the first day, and we will host various events throughout the week with Intel speakers giving their views on current trends in the industry.

Our main goals for Computex will be focused on three areas: First is the evolution of cloud computing and how this is impacting not only hardware, but also software services, for example security and connectivity.

Second, we have spent considerable efforts to enable Intel in the mobility space including tablets and phones, and we will look to highlight the results of those efforts. For example, recently, Asustek Computer announced the Zenfone-series with Intel silicon inside which has received positive feedback in many countries; good battery life, reasonable performance, and good cost-performance. We have also spent a lot of efforts working with the industry to support various efforts with Windows, Android and Chrome OS. Recently in the US our partners introduced a series of Chromebooks using our silicon, and Microsoft just announced the Surface Pro 3 using Intel Core i3 CPU. This shows to the whole industry the scalability of Intel, from very small, cost-effective, smartphones all the way to high-premium devices.

Finally, we want to show our investment in IoT (Internet of Things) and wearables. A lot of people are talking about IoT, it is a very broad topic. We will nail into several areas including how we intersect into very-small, highly-integrated silicon with all the sensors and modem built-in. We can enable a wide range of products from I/O gateways all the way up to end-devices with our platform. We supply the security stack, the SDK, and the silicon capability, giving us a whole-value proposition for the IoT space.

Q: In recent years we have seen the industry move away from desktops and notebooks, to tablets, smartphones, and now wearables, how have these changes affected Intel?

A: The key challenge has been the need to create much more integrated silicon than we were before. So going forward you will see us talk about more products like our SoFIA which is probably the first highly-integrated system-on-chip (SoC) in Intel’s history, it has everything integrated into one package.

That has dramatically changed the way we design products, bringing the cost and power down and shrinking the die-size, and integrating as much as possible so the total number of components needed to build a system is significantly reduced. In the past our disadvantage was that our solutions had too many components, so this is where we are going to simplify.

Q: And how are you planning to achieve these changes?

A: We had to quickly break some of our old design principles, the cadence needed to be accelerated. You can see we actually talked about SoFIA for the first time in April and we are going to deliver the product by the end of the year, so we have accelerated the whole development cycle from our typical two-year cadence down to less than one year. Secondly we have to make sure we leverage a lot of the technology we have, we need to take all the elements we have in the company and put them into one package that we can quickly deliver to the market.

Q: Is your goal to have all the technologies in your SoC packages developed in-house, or will you also get certain components, such as sensors, from other companies? Are there any key IoT technologies that you have had to start developing from scratch?

A: A lot of the technologies are in-house or things we have gained through acquisitions. For example we acquired Infineon several years ago which gives us the modem for our SoCs.

Actually our approach to IoT has been pretty interesting. When Brian Krzanich our CEO introduced the concept of IoT, we took two approaches – one is to go to the industry first which is our usual way, the other way was to introduce the concept to the open community. We are supporting the maker community with products like Galileo and Edison directly through the community. We have taken a completely different approach. This has opened up these products to innovations from different areas, from schools, from small system integrators, and from individuals.

Q: Do you have any specific examples of how this open approach has been successful?

A: We have a campaign, a global contest, called “Make it Wearable”, which we have opened up to innovations from all different areas. As the contest progresses we will be looking at the submissions to see how we can help each concept become an actual product this is shipping to the market. So we may be looking at providing support in production, or by tuning future product development towards these new areas. I think this is a very exciting. If you think about it, these ideas may be very simple to begin with because they are coming from individuals or small teams, but Facebook was a simple, creative idea in the very beginning too, and yet it has grown to change the whole world.

Q: Intel has been making a lot more effort in terms of software in recent years, why is that?

A: Software is playing a much bigger role in the overall platform. Especially for new devices like tablets, smartphones, and wearables, software is one of the key differentiation features between devices. Our efforts have been about how to provide the best security solution for both the consumer and enterprise/commercial segments, how we can actually start to integrate enterprise security features and bring them down to consumer usage.

We do not see McAfee as just anti-virus, it is security at all levels all the way up to servers. If you want to do a really good IoT solution, you cannot just provide low-power usage and connectivity, you need to ensure it is secure.

Q: What is the role of Taiwan in the current IT industry and how is Intel working with players from Taiwan?

A: Taiwan plays three major roles, in my opinion. Taiwan is the center of the ODM industry, that is the majority of PC or server design manufactures are from Taiwan. Taiwan-based companies represent more than 90% of client PCs. And I think this relationship will continue, they will continue to build 100s of millions of PCs every year for the global market.

This means that for the key initiatives we have for client PCs, like 3D cameras, we have to drive them through the ODMs, so we will continue to work with Taiwan to ensure all our key technologies are deployed through the ODMs to their OEM customers, and to the end-user.

Taiwan brand vendors have taken a bigger market share globally, for instance we have a very good and long relationship with Acer and Asustek, they are among our top-five strategic partners in APAC, and we will continue to work together on future platforms for the PC and mobility segments. You can see that both companies recently introduced Intel-based tablets or smartphones into the market, so that proves the collaboration between Intel and Taiwan’s brand vendors is very tight.

Thirdly, Taiwan has a huge IT ecosystem, cameras, sensors, panels, touch solutions etc., and we want to collaborate to make sure the whole ecosystem can support Intel’s key initiatives, through close collaboration to ensure components work with Intel platforms and via capital investments to drive deeper collaboration.

Q: China has developed in recent years as not only the largest manufacturing base for the IT industry, but also a major market in terms of consumption. How has this affected Intel’s approach?

A: From a whole industry point of view, I think companies from Taiwan will remain as the key suppliers for most product categories, although some China-based companies have grown to become major suppliers. The main benefit for companies in China is that China has grown to become a huge end-user market. If you are making a product specifically for the China market it is clearly more efficient to do the work in China, but for global products it is still probably more efficient to do the design in Taiwan.

As an example, in China the end-usage model for tablets is different, they first of all do not use Facebook or Google apps. To make an Android device for the rest of the world you need to go through Google certification in order to access the Google Market Suite (GMS) of apps, and in order to pass certification you need to meet Google’s requirements which means you have to use the components Google has approved. But in China since you do not need GMS, you can use non-certified components, so you can make cheaper devices.

Q: What is your outlook for the next 3-5 years? Are we going to see any game-changing technologies like tablets, or will the industry be more stable?

A: My personal view? I think that for the enterprise sector things will not change too dramatically. Productivity needs, security and IT procumbent policies drive this sector and it takes some time for new technologies to be proven effective, stable, and secure before they can be adopted.

For example even though cloud is a big focus of the IT industry right now, enterprises will never adopt the public cloud due to security concerns, we will need to wait for private cloud technology to become mature enough before we will see any impact on the enterprise. It will take years to really get there. At the same time, today’s mobility devices, tablets and smartphones, will not become the primary devices for enterprise users because of productivity and security concerns, notebooks will remain the main enterprise device over the next few years.

But I think tablets will continue to grow in the consumer space. End-users typically only need to check email or browse the Web, and so tablets are good enough to meet these needs. And if you need a cheap device, say only US$100, then Android devices can meet this price-point, so for emerging markets we are seeing tablets ramp very nicely. I also expect to see unique tablet usage emerge in the commercial space, for example, I expect big-box stores to follow the Amazon model and release own-brand tablets to help drive e-commerce sales. Also I see a lot of tablet usage in education.

I think Moore’s Law will continue to play a very big role in future devices. In the end this talks about the capability of the silicon. So for example if we can get 14nm into full ramp in production this will mean we can bring the die-size even smaller, consume far less power, and drive much more integration than where we are today.

 

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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