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Despite Intels recent woes, I didnt expect to see CEO Pat Gelsinger joining 15,000 or so of his colleagues being shown the door. Gelsinger is a storied engineer and business success who laid down an exhaustive rescue plan when he took the helm of the beleaguered chipmaker in 2021. It was never going to be a quick fix, given the companys long legacy of missteps. Gelsinger may be the public face of Intels current malaise, but the problems started long before his tenure and will likely keep going. How Intel got here Gelsinger was tasked with addressing almost two decades worth of bad decisions, all of which have compounded. Intel became an industry-swallowing behemoth as one half of the Wintel alliance, producing chips that went hand-in-glove with Microsoft Windows. The vast profits that flowed from this partnership meant there was an institutional reluctance to look too hard at new business ventures that could distract from its golden goose, still going strong all these years later. In 2005, then-CEO Paul Ottellini turned down the chance to make the iPhones system-on-chip. It would have been easy for Intel, since it already made XScale ARM chips for mobile devices. You could find an Intel ARM chip inside popular phones like the BlackBerry Pearl 8100 and Palm Treo 650. A year later, it would sell XScale to Marvell, believing it would be able to shrink its x86 chips to work on smartphones. The first Intel Atom handsets showed some degree of promise, but the Snapdragons of the day produced by considerably smaller rival Qualcomm beat them pretty easily. At the same time, Intel was working on Larrabee, its own discrete GPU platform based on the x86 architecture. Despite several years of marketing bravado and suggestions it would kill AMD/ATI and NVIDIA, Intel axed it in 2010 in favor of bundling integrated graphics into its regular processor products. The decision would hand the bulk of the GPU market to NVIDIA, making it the go-to name for gaming, supercomputers, crypto and AI, posting quarterly revenues of $35.1 billion on November 20. Could Intel have foreseen the meteoric rise of AI? Maybe not. But Reuters reported former Intel CEO Bob Swan turned down the chance to invest in OpenAI in 2017. It was looking for a hardware partner to reduce its reliance on NVIDIA, offering a generous deal in the process. Swan, however, reportedly said he couldnt see a future for generative AI, and Intels data center unit refused to sell the hardware at a discount. Intels core strength was in the quality of its engineering, the solidity of its product and that it always kept close to the cutting edge. (There are parallels to be drawn between Intel and Boeing, both of which are watching their reputation for quality erode in real time.) Sadly Intels bread-and-butter business hit the skids after the company failed to produce 10-nanometer chips by its planned 2015 deadline. The companys famous tick, tock strategy of launching a new chip process one year and a refined version the next ground to a halt. These issues enabled Intels competitors to step in and steal a march, harnessing more modern chip architectures. AMD, which held a little over 10 percent of the chip market for much of the 2010s, has seen its market share double in the last few years. The biggest beneficiary, of course, was TSMC, the Taiwanese chip factory that has become the envy of the world. Even if Intel controls the bulk of the x86 processor market, its TSMC that makes the chips for Apple, Qualcomm, NVIDIA and AMD, among others. Intel, meanwhile, was saddled with an older chip manufacturing process that it couldnt use to catch up with its rivals. The Gelsinger doctrine Gelsinger was as close to an Intel lifer as you could imagine, joining the company at 18 and rising to the position of Chief Technology Officer by 2001. In 2009, he left Intel to become COO at EMC and held the position as CEO of VMWare for almost a decade. After taking the reins at Intel, he laid down a detailed plan to mastermind its glorious comeback. Step one would be to separate Intels design and manufacturing business into two distinct entities. With one eye on US subsidies through the Biden administration's CHIPS and Science Act, Gelsinger pledged to build two new chip factories harnessing the same EUV (Extreme Ultraviolet Lithography) technology used by TSMC. Gelsinger was also determined to reestablish discipline in Intels chip business and get back to the tick, tock structure. Unfortunately, the production delays that had been building up since 2015 meant that Gelsingers target was just to get back to parity. In the interim, Intel would also get TSMC to manufacture some of its newest chips which, while costly, would help address any concerns the company was lagging even further behind. Nobody had any doubts as to the size of the task facing Gelsinger, but there was plenty of room for optimism. Gelsinger was humble enough to accept Intel couldnt simply stay on its current course, and had to embrace its new status. He proposed Intel could grin and bear the short-term pain for the company's eventual benefit. If it could build for the future, harness its rivals to keep it in the game and restore faith in its processes, Intel would emerge from this as the winner. All it needed was for nothing to get worse. Things got worse At the end of October, Reuters reported Gelsinger made a colossal faux-pas when speaking about TSMC. The CEO was quoted saying You dont want all of our eggs in the basket of a Taiwan fab, and that Taiwan is not a stable place. This offended TSMC to such an extent that it ended a discount Intel had taken advantage of for years Sadly, Gelsingers desire to restore discipline to the chip division would also backfire, with the latest Core processors blighted by voltag instability issues. Intel was forced to extend those chips warranties, which came at an additional cost it couldn't really afford. In August, it posted a loss of $1.6 billion and pledged to cut 15,000 employees in an attempt to right the ship. But it was forced to post the biggest quarterly loss in its history three months later, losing $16.6 billion, albeit much of that tied to revaluing company assets and paying for the layoffs. Worse, Intels new production process, 18A, reportedly failed crucial tests ahead of its 2025 debut. Perhaps the lowest point in Intels year was when its stock price fell low enough that it became a takeover target. Rumors suggested Qualcomm was potentially eyeing a takeover while others indicated ARM had made inquiries about purchasing Intels product unit. Where does this leave Intel? The New York Times reports Intels board grew frustrated with Gelsinger as his rescue plan was not showing results quickly enough. But Intel wasnt going to hire Gelsinger in 2021 and suddenly bounce back in 2024. Building large and complex chip factories isnt easy. Nor is getting thousands of engineers to solve difficult problems around chip yields. And obviously reversing a slide that started in 2015 was never going to happen overnight. Intels board is presently looking for a full-time successor to Gelsinger but its hard to see what someone else would do differently. After all, the company still needs to build those factories in order to own and control its future, and it still needs to fix its processes. Unless, of course, the next CEO is going to be told to just stanch the bleeding and keep the money rolling in. Even in its deeply-wounded state after a few bad quarters, Intel is still the biggest name in the x86 chip world and will keep making money for years to come. You could easily imagine Intels board sitting around, prioritizing a few years of healthy profits at the cost of the companys long-term future. It can keep selling modified versions of its existing desktop chips, ceding the technological leadership to AMD, Qualcomm and others. Theres probably a decade or two of big industrial clients who would be happy using Intel processors for their hardware for as long as theyre still using Windows. Perhaps that would be fitting given how big and ossified Intel has become, admitting that it cant move fast enough to evolve. Its likely that scenario wont be allowed to happen given Intels broader role in the global tech space. Even if the incoming administration criticized the CHIPS Act Intel is still set to be its largest funding recipient having a domestic manufacturer of Intels scale will be an asset few sane governments would allow to fall. But just switching CEOs wont suddenly fix the companys big, hard-to-solve problems. It wasnt Pat Gelsinger who screwed up power design for Raptor Lake, nor did he pass on the opportunity to make the iPhone CPU all those years ago. The TSMC stuff, he can own that, but while a CEO sets the direction of travel, he cant micromanage every process in a company of Intels scale. So whoever replaces him will have the same big stack of issues to tackle, knowing that the boards patience will be even shorter this time out.This article originally appeared on Engadget at https://www.engadget.com/computing/firing-pat-gelsinger-doesnt-solve-intels-problems-173420381.html?src=rss
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On todays International Day of Persons with Disabilities, LEGO is turning the spotlight on fans and coworkers with non-visible disabilities. That category makes up 80% of the 1-in-6 people globally who live with a disability, and its why LEGO is partnering with Hidden Disabilities Sunflower.
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Indonesias investment minister, Rosan Roeslani, said that the country is expecting $1 billion from Apple as an investment. Its important to note that Indonesia has banned iPhone 16 sales locally because the smartphones must contain at least 40 percent locally-made parts. Apple doesnt have any manufacturing facilities in Indonesia, so it cannot meet this requirement. Roeslani further said that Apple should invest even more in the future if it intends to make Indonesia a part of its supply chain. He also remarked on how an Indonesian Apple plant can create jobs. Previously, Apple had proposed to invest $100 million in building an accessory and component plant in Indonesia. The Indonesian government rejected it due to not meeting principles of fairness. While Apple still doesnt have local plants to meet the 40 percent local content requirement, it does have application developer academies in Indonesia. That was why older iPhone models could be sold in the country. They remain on sale as of now, and theres been no indication that Indonesia is looking to ban them currently. Reuters had contacted Apple for comment on the situation but has yet to receive a reply.This article originally appeared on Engadget at https://www.engadget.com/big-tech/indonesia-expects-apple-to-invest-1-billion-to-get-the-iphone-16-back-on-sale-162906748.html?src=rss
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