Here’s why Intel announced a custom silicon business

In what looks like a noteworthy shift for the chip giant, Intel says it is inside the custom silicon business, showing off its current efforts big customers, and its future plans at a media event Monday. The event featured Intel’s webscale and cloud executives Jason Waxman (pictured) and Diane Bryant discussing how Intel is now offering custom chips for customers: something that would have been unfathomable even a decade ago at the storied company.

Waxman detailed how Intel made a custom chip for eBay and said it was doing the same with Facebook. Customized chips are gaining ground as data centers grow larger and as efficient computing becomes paramount for companies at which compute is often the primary cost associated with their services. Companies are building out custom servers for different workloads and eyeing the use of different chip architectures — from ARM to GPUs.

This represent a huge threat to Intel, which has struggled to release a credible massively parallel GPU-style chip (the Xeon Phi is what it has on offer today) and seemed to miss out on the benefits of using smaller, low-power cores for certain webscale workloads until it was pulled into the market by SeaMicro, a startup later bought by AMD. Intel’s biggest advantage in chips has historically come from its ability to churn out billions of them as cheaply as possible thanks to its massive economies of scale and huge investments in factories from the profits of the PC industry. Customization breaks that model.

(c) 2013, GigaOM.com.

 
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