Intel had expected its Q3 results to be better by only three to five percent over the Q2 revenue? What was the reason behind this slow growth?
When we had made that statement, the European market had slowed down. Business in other markets had performed well, but not in Europe.
What is the contribution of the European market to your worldwide revenue?
Europe contributes 30 percent. North and South America contribute 40 while Asia contributes a little over 30 percent.
Is it true that shipment for the 1.3 GHz P-III (that had been recalled from the market) has already begun in Japan. When do you expect this to be shipped in India?
1.13 GHz has not been shipped. We are working with our OEMs on the engineering of the chip and are getting feedback to enhance its performance. It has not been released in Japan, because when we release it, it will at the same time worldwide.
When do you expect this to happen?
We always release our products when it is ready for the market. For the 1.13 GHz, a date has not been finalized.
Is it true that the release of the 1.13 GHz P-III is getting sidetracked because Intel is concentrating on P-4?
Intel is a very large company and there are specific engineering teams dedicated to specific products. Engineers working on the 1.13 GHz are different from the ones working on the Celeron. So there is no issue of sidetracking one product for another.
When the 1.13 GHz was launched initially the numbers released in the market were very small and then recalled. Was this because of the engineering fault?
Quantities have to do with the requirement of the market and the availability of the product. It has nothing to do with the engineering issue because if we knew about the issue, the launch would not have happened. Yes, you can look at it the other way around, that the volumes were low, so the recall was easier to handle.
How do plan to push P4 into the mainstream market, which is largely dominated by the PIII and the K6?
It will not be very different from what we have done in the past. In a marketplace there are different users – value users, mainstream and the high-end users. And you have a point, which is the mean of the market. And there is the factory, which can produce a certain amount of high-end, a bit more mainstream and a lot more value products. As time goes by, the factory continues to produce faster and faster processors. So what happens is that the high-end product will become the mainstream and then the value product. And at any given point the matching the two is imperative.
The same thing will happen with the Pentium 4. Initially it will be a high-end product, but with the advance in technology, it will become a mainstream product.
Are there plans to discontinue the Celeron, now that you have the Pentium families of faster processors?
Just like we have the Pentium brand, we have Celeron as a brand. That fits in fine in our product lines. We can’t say at this time one way or the other about when we will discontinue the Celeron, if we do plan to do so. This is because both the families cater to different segments of the market.
For a user who is very value-conscious and wants a computer with few frills within a certain budget, Celeron is the right choice. If a person has a long-term interests in mind and wants to have a product, which will last longer and has high-end specification, that is what the Pentium 4 offers. And these too diverse needs are going to exist always. So we will continue to bring new additions to the Celeron and the Pentium.
And now we have also new enterprise brand called the Itanium. We have announced the name and the products will be rolled out in a few months time.
Will the Itanium be launched simultaneously all over the world?
Yes, but in the enterprise world the launch is different. It is not like a product launch in the consumer world. Here you would have a full range of OEM accounts for the product range and then we launch and then people will go and buy.
In the enterprise world, the product has been seeded. For instance, say that you are a bank. You are not going to go to a shop and buy computers. You would want your specific vendor, he will give you some units for evaluations, then you are going to do the application integration and then you start buying. The roll out has already been started and will be escalated in a few months.
So in some places we have already given Itanium. There are Itanium-based systems in India. Our partners in Pune have got Itanium systems where they are helping their clients to post their software on the Web.
These systems are not used for transactions, they are used for development work. And we are also testing at other places. The systems are already working.
This is the seeding for the content and the development community. The next will be the seeding to the OEM community. Then the OEM community will start seeding to major business houses. Even the selling is different than going to a GID and ask him to set up the system for you. The integrators have to understand how it performs on various platforms. So the Itanium launch is kind of a misnomer.
Is Intel going on the fast track to manufacture its ultra-low power chip for notebooks to counter Transmeta’s Crusoe?
When you really look deeper into it, you will find that what Transmeta is talking about is not different from the Intel technology. There is a spectrum, you can talk about competition and the power. We too have chips that run at 1 Watt and give performance. But we found that merely having the technology is not enough. You need to build upon it. We have the massive presence and business to introduce newer technologies.
What initiatives has Intel chalked out for the mobile technology?
The best thing that has happened in mobile technology last year is that you get desktop performance when you plug your notebook into the wall socket. Of course, there are issues like the compactness. If you can put certain amount of wattage in the desktop, you cannot put the same in the notebook. Otherwise your fan will become very noisy or something else. So talking about the technology factor, it is moving faster into the market.
What are your plans for the cellular phones market?
Worldwide in the cellular market, we are the biggest seller of flash memory. If you look at the new phones, they are using a lot more flash memory than before due to new features like recording. We have R&D centers in Japan, China and Scandinavia where we are working with manufacturers of cellular phones. We do not have such a thing in India because there is very little sharing of technology happens here.
Phones are getting WAP-enabled. My feeling is that we are going to have multiple ways of connecting to the Internet but the PC will be very dominant. There is a phone, a PC and a TV. When you look at the phone, it is a communication device. A PC is a productive device that you use to do your work. TV is an entertainment device. And then there is the Internet.
Even with the Internet, the primary functions of these products will remain the same. Despite WAP, the phone will still remain a communication device. So my feeling is that the context will remain the same. The phones will not become your productivity tool. But certain things can become a reality in the future, like video-conferencing.
What work is being done in your wireless development centers?
We are looking at how chips can be used in cellulars. We do research in the better usage of the ICs. In the US there are two-way interactive pagers with built-in keyboards. They use wireless radio network. It is not very popular, but it is a great device. And it uses Intel flash memory chipsets. If you have a product and you want to sell it well then you have to help in the designing of the product. This is how joint development centers come up.
Intel is making a transition to the 370-pin socket FC package. How superior is it to the slot version?
The 370-pin socket technology is good for the desktop. Its package is cheaper to develop, sell and use. The cartridge also has built-in cache memory which is not in the slot version.
Intel’s networking products have not made a great impact in the India market. Why?
We have been in networking for a long time, but we have not made any huge investments. If you look at our investments it is only $ 20 billion. But now we are going to become more aggressive in the market. I think you will see a lot of growth in Intel’s networking products in the months to come.