Intel's Barrett reflects on tenure as CEO

Intel's Barrett reflects on tenure as CEO

Craig Barrett gave his last IDF keynote address as CEO of Intel Tuesday, but he isn't going away just yet.

Intel Corp.'s Craig Barrett has maintained his sense of humor about resigning his chief executive officer (CEO) role in May and becoming chairman of the world's largest semiconductor maker, referring to the process as "getting kicked upstairs and out of the way" during an interview at the Spring Intel Developer Forum (IDF) Tuesday.

In accordance with Intel's mandatory retirement policy, Barrett will relinquish a day-to-day role at Intel just as the company appears to be turning the corner from the various missteps and manufacturing glitches it endured in 2004. The company unveiled a horde of details Tuesday surrounding its upcoming transition to dual-core processor designs, and given the restrained enthusiasm urged by Barrett last year in regard to providing details about upcoming products, analysts called the announcements a sign that Intel is much more confident about its desktop and server road map than it was at the last IDF in September.

That same confidence was apparent in Barrett's demeanor during a meeting with reporters following his keynote address, which focused on a bright future for microprocessor manufacturing and new applications that will be developed for future processors.

Reflecting on his seven-year tenure as CEO at Intel, Barrett said he was proudest of maintaining the company's profitability and status as the world's largest chip maker during the severe downturn in IT spending following the collapse of many Internet companies in 2001.

"Intel is a technology company. It is successful when it continues to invest in the future," Barrett said, referring to his decision to invest heavily in new manufacturing technologies during the downturn.

But not all has been rosy under Barrett's tenure. The company's Itanium processor was once envisioned as the future of its server business and the industry's path to 64-bit computing, but the market has not responded to Itanium, which uses a different instruction set and software from Intel's x86 chips such as the Pentium 4 and Xeon processors.

"Would I have liked (Itanium) to ramp faster? Duh," Barrett said. But he said the chip has a future in high-end servers, although that's a far smaller market than the one Intel had originally envisioned for Itanium.

Barrett has also insisted that Intel develop expertise in chip architectures for communications devices, an effort that has had its ups and downs. The company's XScale applications processor is popular with personal digital assistant and mobile phone manufacturers, its flash memory business is relatively strong after some hiccups, and just about every notebook user on the planet has heard of Intel's Centrino mobile technology for connecting to wireless networks. But a much-hyped entrance into the market for communications silicon in mobile phones has flopped, as no company has released a mobile phone featuring Intel's Manitoba processor.

Reviving the prospects of its mobile phone communications silicon is one of Intel's biggest challenges over the rest of the decade, and the company has significantly increased its investment in that technology, Barrett said. The company will also need to identify new materials that will enable it to continue shrinking the size of its transistors into the next decade, keeping to its historic pace of performance gains, he said.

Those investment decisions and challenges are about to pass to Paul Otellini, the current president and chief operating officer of Intel and Barrett's designated successor. The transition will be very similar to the one that took place when Barrett became CEO in 1997 and Andrew Grove became chairman, Barrett said.

Otellini will likely hold off on designating an executive to take over his role as operations chief, Barrett said. Intel recently reorganized its operating structure into groups such as the Digital Enterprise and Digital Home, and many executives that are thought to be front-runners for Otellini's old job have just taken on new responsibilities.

"Historically, we've used that COO position as an orderly transition of management, and Paul will make that decision over the next couple of years," Barrett said.

Barrett's primary role as chairman will be advocating greater investment in the "sorry state" of the U.S. education system, as he put it. He has very passionately argued for several years that the U.S. is losing its edge in technology expertise, and the only way to fix that situation is to make today's students

more interested in science and technology.

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