E.V.'s economic giant Intel turns 40 - East Valley Tribune: News

E.V.'s economic giant Intel turns 40

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Posted: Thursday, July 17, 2008 9:42 pm | Updated: 12:00 am, Sat Oct 8, 2011.

This story was written on a computer with an Intel processor inside.

If you are reading this story on a computer, you also are likely using a machine that depends on Intel technology to make the words appear on the screen in front of you.

At the age of 40 - a birthday the company is celebrating today - Intel Corp. may one of the most important companies in the world.

Click to view a map of Intel's East Valley operations
Intel’s East Valley operations, C11 BUILDING, OCOTILLO CAMPUS, CHANDLER BOULEVARD CAMPUS, Chandler Blvd., Ray Rd. Fab 12, Fab 22, Fab 32, Alma School Rd., Dobson Rd., Loop 101, 202, Interstate 10, CHANDLER, Chandler Fashion Center, McClintock Dr., Ocotillo Rd., Chandler Heights Rd., Queen Creek Rd., Pecos Rd., Kyrene Rd., Rural Rd., Price Rd., 56th St., Graphic by Ed Taylor, Scott Kirchhofer/EAST VALLEY TRIBUNE, SOURCE: Intel

Most businesses and individuals using a computer or network of computers probably are depending on Intel's technology to be able to function. That's because Intel holds about 77 percent of the world market for microprocessors - the central brains inside personal computers.

"If Intel were to go away, it would have an impact globally," said Brian Matas, vice president of Scottsdale-based IC Insights, a market research firm. "It would take some time to fill that vacuum."

If Intel were to suddenly disappear, it also would create a big gap in the East Valley economy. Not only is the Santa Clara, Calif.-based technology giant the largest private-sector employer in the East Valley with 10,000 employees, but it also is a huge charitable contributor and the largest private-sector taxpayer.

"They've done so much, it's hard to keep track," said Chris Mackey, a Chandler economic development specialist, in referring to the company's charitable donations. "You couldn't put a dollar value on it."

Among the company's projects have been food drives, Christmas toys for families in need, equipment for libraries and computer and software donations to schools, she said. Much of the value is in the time that employees are allowed to contribute to community programs, she said.


Intel was founded as a maker of memory chips by two former Fairchild Semiconductor executives, Bob Noyce and Gordon Moore, on July 18, 1968. For a company that wanted to become renowned for its precision, it didn't get an auspicious start - it's initial business plan contained three typographical errors.

And for awhile Intel was just another memory company. But the firm's fortunes took off when it began making processors for early personal computers made by IBM and others in the late 1970s and early 1980s, Matas said.

"They really got traction in the mid-1980s with the 386 line of processors," he said. "That really helped the company establish itself as the dominant supplier. They became like Microsoft was with software. They were the hardware."

By 1992, Intel had become the largest semiconductor company in the world.

As the company prospered, it put back more money into research and development to improve microprocessor technology and also made massive investments in manufacturing capabilities, Matas said.

"They are one of the few semiconductor companies left that does a lot of their manufacturing in-house," he said. "Most of the others have outsourced to some degree."

Over the years, Intel and other semiconductor companies have performed miracles of miniaturization, packing more and more transistors onto small silicon chips. That increased computing power makes possible the clear, life-like graphics that appear on today's video game players, among other technical marvels.

While teenagers might take it all for granted, a lot of work was required behind the scenes. Intel's early processor chips had just hundreds or a few thousand transistors. Today, the company can place more than 800 million transistors on a chip the size of a postage stamp.

If today's processors were based on the size of the first transistors, the chip would be the size of a two-story building, said Bill Kircos, communications director for the research and development group in Chandler.

The scaled-down world of the semiconductor industry has conformed so far to a "law" predicted by Moore in 1965 that the number of transistors incorporated on a chip will about double every 24 months.

Intel has made a few miss-steps over the years. In 1985 it exited its original memory business. And some acquisitions in the communications field in the late 1990s failed to pay off.


But for some people, Intel has been too successful in its core processor business. On Thursday European Union regulators said they were expanding their anti-trust case against Intel, claiming the company has deliberately squeezed its main competitor, Advance Micro Devices, out of the chip market by, among other practices, giving rebates to retailers that agree to sell only Intel-based computers. The result, according to the EU, is higher prices for consumers than would be the case if there was unfettered competition.

Intel responded that its conduct has always been lawful, pro-competitive and beneficial to consumers.


The next 40 years will no doubt produce new technical miracles in personal computing, even though no one can predict with certainty that far ahead, Kircos said.

"In this business, it's really difficult to predict more than five years out," he said. "Five years ago there was no Facebook, no YouTube, no social networking. Rapid innovation can spark a revolution."

Still, it's clear the development of super-fast wireless broadband networks will offer access to the Internet wherever computer users go, he said. That could spark such innovations as handheld mobile devices that, when waved over a menu at a restaurant in China, could translate the words into English. Similarly, such a device could be pointed at a street sign and tell the user where they are and how to get to where they want to go, he said.

Another possibility is "true" virtual reality in which a gaming device such as the Nintendo Wii could teach the user how to dance with a virtual partner or learn karate moves from a virtual teacher, Kircos said.

Intel also sees a bright future for intelligent robots, which could perform routine household chores such as stacking dishes in a dishwasher, he said.

Intel is pushing WiMax, a Wi-Fi-type technology with extended range that could provide wireless Internet connections over entire cities or countries. Intel is expanding its product lines to chips for handheld units such as smart phones, navigation devices and mobile Internet computers that could connect to the Internet through WiMax.

"We want to be the leading silicon provider to the Internet," Kircos said.


To celebrate its 40th anniversary, Intel is asking young people who will be creating the innovations of the future to make their predictions about what technology will look like 40 years hence. Students at Intel Computer Clubhouses in 14 U.S. states and 19 foreign countries - including one in Chandler - have created digital "tiles" that will be incorporated in a virtual mural. It can be viewed online at www.worldmuralproject.com.

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