Intel's Paul Otellini talks tough

The CEO of Intel tackles recession, Atom, flash and Nvidia...

Intel chief Paul Otellini offered his two cents on the credit crunch, Atom, flash memory and the recent, ongoing fracas between his company and Nvidia, during a speech at the Goldman Sachs Technology and Internet Conference in San Francisco.

Otellini explained that the grey clouds of economic doom had severely impacted chip inventories, noting it would be "hard to imagine that there's a significant drop below this" and emphasising just how important it was for Intel to move to 32nm process technology.

The Intel CEO said his firm was "quite confident in the benefit of the technology", especially in terms of lowering production costs. This, he said, gave Intel "comfort" and would allow it to kick some serious CPU arse when the market recovered.

Discussing Atom's success, Otellini told his audience the little chip, would become even more of a money maker for the firm as Intel moved toward a system-on-chip (SOC) design. The diminutive netbook processor has been a ray of light in the current recession, providing Intel with a sizeable quarterly cheque to cash in at the bank, while its rivals beg for loans.

Despite Atom being seemingly recession proof, however, Otellini seemed keen to play down the hype, lest anyone got too carried away by the cheap-as-chips chip and stopped buying bigger, more expensive processors with compute power most users didn't need.

"Atom is still less than half the performance of our entry-level Celeron product. It wasn't designed to be a notebook replacement part," he said.

In case that wasn't enough to dissuade sceptics from settling for just a netbook, Otellini said Microsoft's Windows 7 version for the little lappies would limit users to running just three applications at a time, gleefully adding "You'll be underwhelmed".

Intel's strategy increasingly points to the firm doing its utmost to push Atom from the low-margin netbook space into the high-margin smartphone and MID segments of the market. The deal forged between Intel and LG at last week's MWC in Barcelona to bring out a Moorestown-based MID is a case in point. Otellini hinted that Intel had plenty more partnerships like the LG one in the pipeline and told the audience to "watch this space".

Blasting Nvidia, in the spirit of low-level tit-for-tat we have become accustomed to this week, Otellini asked, "If you don't have a microprocessor, what else do you have to sell?", implying that running a computer on a GPU alone was about as sensible as using chopsticks to eat yoghurt.

Otellini accused Nvidia of trying to "defend the status quo" and snidely remarked that, if users wanted high performance and optimised graphics, they could simply buy a discrete graphics chip. "You can buy it from them or you can buy it from us," he stated, alluding to Chipzilla's much anticipated Larrabee graphics silicon.

As for poor old flash memory, Otellini seems prepared to let it fall flat on its arse, noting he'd be perfectly happy buying NAND flash from third parties.