A Man of Many Firsts

(By Damian Dovarganes -- Associated Press)
By Mike Musgrove
Washington Post Staff Writer
Saturday, February 11, 2006

Paul S. Otellini, head of Intel Corp., the chipmaker famous for its alliance with Microsoft Corp. and the Windows operating system, is expecting delivery of his new Mac laptop any day now. It'll be his first.

Otellini might be the first guy at the top of the world's largest chipmaker to buy a computer from his company's longtime neighbor in Silicon Valley. He doesn't know for sure. But it's certain that he'll be the first to own a Mac with an Intel processor inside.

Starting this year, Apple Computer Inc. is building its computers around Intel processors. Apple's orders will amount to small change for the gigantic chipmaker, a day or two's worth of production. But the development is emblematic of a larger reinvention behind the scenes at the venerable tech company as it tries to reach consumers and regain momentum against mounting competition.

Otellini took the reins last year after his predecessor, Craig R. Barrett, retired and became chairman. The company was co-founded by a famously fiery-tempered immigrant named Andy Grove, whose motto was "only the paranoid survive," but Otellini, who once worked as Grove's technical assistant, comes across as more of a diplomat.

Otellini once headed up Intel's marketing department, and he isn't afraid of stunts to promote the brand. One week, he's on stage at the Consumer Electronics Show in Las Vegas, helping colleague Sean Maloney perform a magic trick to introduce a new processor. The next, he's in San Francisco, wearing the white "bunny suit" of a chip factory worker onstage at Apple's trade show to announce that the new Intel-powered Mac computers would soon start shipping.

Intel remains solidly on top of the processor market, but in recent years, such smaller rivals as Advanced Micro Devices Inc. have eroded some of Intel's long-dominant position. Sales growth for such products as desktop processors have cooled off, and moves by the company to expand into hotter areas like cell-phone components have sometimes fallen flat. Intel's stock has been stagnant.

Otellini is the first non-engineer to run the company, and while he can speak tech-ese with the best of them, he prefers to talk about what his company's technology will make possible -- not what speeds the next wave of processors will hit.

"You talk about bits and bytes and you lose half the people," he said. "It's all about what these things do for you, what capabilities they provide."

That's the new Intel talking. For most of its life, Intel operated as a company whose main task was to design an ever-faster processor; computer makers and software makers figured out how to take advantage of the extra horsepower. Engineers gave the marketing department a head's up on what the next product would be -- now, it's the other way around.

The company was once organized the way a techie would structure it, by type of chip. Now, following a massive restructuring a year ago, the company is organized by target markets.

Otellini is credited at Intel as being a force behind one of the company's savviest steps in recent years: bundling a processor with wireless technology for use in laptop computers.

The Centrino package, as the processor system is known, was unusual for Intel. The company didn't even manufacture the wireless hardware included with the first set. When Intel marketed Centrino, it emphasized the abilities afforded by wireless Internet access, not processor or download speeds.


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