Bangkok--Dec 13--Carl Byoir & Associates
Subject: Technology Leadership - End of Year Materials 2004
The year 2004 was about broadening technology innovation, whether it was in the home, the office or in-between. Intel took the PC through a significant evolution toward the digital home, giving people more ways to enjoy digital music, photos, videos and games on various devices in and around their house (apartment). At the same time, businesses and consumers truly started to live and work the unwired lifestyle. Mobility through wireless notebooks brought businesses more “up time” and new server solutions increased efficiency and reduced costs. People not only adopted new Intel technologies but they adapted them to their home and work environments.
Digital home on the rise
People have always spent their at-home time having fun, being entertained and relaxing. But how they do it is changing. According to The Wall Street Journal, the top three things people like to do in their homes are watching TV, listening to music and using a personal computer. Because of the explosive growth of digital media and the convergence of connected devices, the digital home concept has emerged and is quickly taking shape.
Recent focus group studies indicate that consumers today want to enjoy digital content on their home TVs and stereos. For example, consumers like the idea of socializing with friends and other family members while viewing digital photos on a large-screen TV in the living room, or listening to music from playlists on high-fidelity speaker systems throughout the house. Fuelled by the widening availability of broadband and wireless networking technologies, the day of the “everything connected, all content shared” digital home is fast approaching.
With nearly 70 million digital cameras projected to be sold worldwide in 2004 , billions of digital photographs are finding their way to PCs. The proliferation of DVDs (more than 1 billion were sold worldwide in 2003 ) coupled with the rapidly growing availability of high-definition video content raise the importance of advanced audio. These changes, the digitization of sound, pictures and fun, are making the PC an "all-in-one" entertainment device at the center of the home entertainment environment.
That’s why Intel brought one of the most significant PC platform changes in a decade to consumers this year. In fact, it is the base of the digital home. PCs powered by Intel? Pentium? 4 processors supporting Hyper-Threading (HT) Technology and Intel? 915 G/P and 925X Express Chipsets are the foundation of new digital home platforms. These technologies have created a new kind of PC, an all-in-one “hi-fi” device with high-definition video, high-fidelity sound and wireless connectivity that enhances the user experience whether its enjoying movies or hearing great music.
Intel also recognized that making the digital home happen requires a commitment beyond the microprocessor to ensuring all consumer electronic (CE) devices and PCs can easily share information and work together in the home. This requires standards, guidelines and specifications for interoperability. It also means addressing the CE industry’s need for scalable platforms that offer consumers greater ease of use and seamless access to their digital media. Through the Digital Living Network Alliance (DLNA), Intel worked with PC and CE industry leaders to develop guidelines and specifications for interoperability. The DLNA aims to simplify the sharing of digital content among networked CE devices, mobile devices and PCs.
As seamless interoperability becomes a reality, Intel believes that the vision for the digital home will be fulfilled, creating an environment where CE and computing devices interact transparently thus setting the stage for personalized content to be delivered on any device, at anytime and anywhere.
Unwired lifestyle momentum keeps going
Since the Intelโ Centrinoไ mobile technology launch in 2003, the “unwired” lifestyle has become very popular among consumers and with businesses. New services and content now let consumers enjoy digital media in unique and exciting ways. Wireless connectivity now gives sales forces and executives the freedom to upload or download on the road or from meeting room to meeting room.
From families that want to stream movies room-to-room in the home to kids playing high-speed, wirelessly networked games to students doing homework on campus or at a public hotspot, the latest Intel Centrino mobile technology-based notebooks continue to provide the freedom and flexibility to compute and communicate in more places than ever.
Today, more than 130 laptop PC designs are based on award-winning Intel Centrino mobile technology, and more than 40,000 hotspots in 70 countries are included in Intel’s worldwide Wireless Verification Program, which tests the compatibility of various access point devices and wireless service providers with common configurations of notebooks built on Intel Centrino mobile technology.2
According to IDC research , mobile devices, such as laptops, handheld devices, and an assortment of computing devices (such as smart phones), have a huge impact on the way enterprises conduct their daily operations. With the expansion in wireless connectivity capabilities — including Bluetooth, Wi-Fi, and 2.5/3G — enterprises can now embrace the new technology as they pursue growth opportunities.
According to analyst firm Pyramid Research, there could be as many as 700 million Wi-Fi users by 2008. Wireless mobile computing has clearly resonated with business users, driving Intel Centrino mobile technology to become a mainstay in enterprise IT deployments. However, even as Wi-Fi becomes increasingly pervasive, the benefits and advantages of wireless computing were still clouded by concerns over security and complexity. Intel addressed these concerns by introducing new wireless capabilities for notebooks based on Intel Centrino mobile technology, including new ease-of-use software, advanced security features, and support for the three Wi-Fi standards.
The new module supports the new IEEE 802.11i security standard, which offers the highest level of security currently available. Intel also delivered Intel? PROSet/Wireless software version 9.0 and a new tri-mode wireless module (supporting IEEE standards 802.11a, b and g) that helps users set up and use their wireless connection faster and easier with any Wi-Fi network, at the maximum available data rate.
With higher-performing platforms, a growing ecosystem of software and services over time, Intel Centrino mobile technology is poised to continue extending the ‘unwired’ lifestyle beyond the enterprise to consumers at home and anyone on the road.
Continuous innovation and growth in enterprise platforms
Improving economic conditions are bringing corresponding gains to the financial health and IT demands of the business sector. Expanding business challenges, such as faster data access and an increasingly mobile workforce, are encouraging the industry to deliver more robust enterprise infrastructure, lower total cost of ownership and increased IT agility. Working closely with a rich ecosystem of OEMs, ISVs, SIs and end customers, Intel continued to develop enterprise solutions and platforms that scale across multiple businesses and vertical segments to meet these enterprise needs, both current and future.
Today, Intel architecture accounts for more than 85 percent of all server shipments , as well as nine out of every 10 dual-processor servers shipped - the largest and fastest-growing server segment .
From an overall server market segment perspective, enterprises continued to increase their IT budgets in 2004. According to IDC, factory revenues in the worldwide server market segment grew at 6.9% year over year to $11.5 billion in the second quarter of 2004, marking the fifth consecutive quarter of positive overall revenue growth. Factory revenues for the x86 server market segment for the same period grew a robust 13.0% to nearly $5.0 billion worldwide — exceeding the revenue generated by RISC-based servers for the second consecutive quarter.
Intel continues to introduce more powerful processors so businesses can scale performance levels. June 2004 saw the introduction of the first Intelโ Xeon? processor to offer Intel? Extended Memory 64 Technology (Intel? EM64T) for accessing larger amounts of memory. EM64T is just one of a number of platform innovations that Intel is delivering to enhance its IA-32 platform, along with Hyper-Threading (HT) Technology, and enhanced power management capabilities.
In the high performance computing (HPC) arena. Intel-based systems today now make up 287 (or 57 per cent) of the Top 500 fastest supercomputers in the world, from some 287 systems (37 per cent) just six months before (November 2003). Intel Itanium 2 processor-based systems have seen extraordinary adoption levels in this market segment this year, more than tripling from 19 systems in June 2003 to 61 in the current TOP500 report .
Today, turnkey Intel-powered commercial, off-the-shelf cluster systems are available from several leading manufacturers and specialty solution providers, complete with polished releases of commercial software and comprehensive product support. HPC has found a welcome home in industries such as manufacturing, finance, energy, life sciences, digital media, in addition to national-level research laboratories.
Richer features in handheld devices and mobile phones
Convergence in communications is the most prevalent trend in the handheld device segment, and it’s really happening. The worldwide market for mobile phones grew in the second quarter of 2004 on the strength of renewed consumer demand for mid-range handsets featuring color screens and cameras. Worldwide mobile phone shipments in the second quarter of 2004 increased 2.5% over the first quarter and rose 36.7% year-over-year to 163.7 million units.
Advances in wireless broadband also demand a new kind of wireless device. As various forms of wireless broadband access become increasingly available, such as 3G, Wi-Fi or WiMAX, mobile devices must have plenty of performance balanced with low power capabilities to handle all that the Internet has to offer.
In order to meet increasing market demand, Intel introduced the Intel? PXA27x family of processors which added a number of new technologies to address the needs of mobile phone and PDA users. The new family of processors based on Intel XScale? technology can handle multiple forms of wireless broadband access with enough computing power to provide mobile phones with full motion video conferencing capabilities and PDAs with DVD-quality video playback.
It’s also the first time Intel has integrated important security features through its Intel Wireless Trusted Platform to provide services such as trusted boot, secure storage of private information and cryptographic keys, and support for common security protocols. With the additional features and processing power, it enriches the experience of mobile phone and wireless PDA users in work or at play.
Modular movement momentum
The modular communications platform lets carriers quickly deploy new services while reducing operating costs. One way to do this is the adoption of standards-based building blocks or modules, like those supplied by Intel, for design and development of communications infrastructure networking gear. This modularity movement is growing in popularity with Intel seeing wider adoption and increasing support from the telecommunications industry for this approach.
For example, Huawei and Korea Telecom are both adopting and delivering services on Intel-based modular communications, including AdvancedTCA*, platforms and carrier grade Linux. UTStarcom and Fujitsu have both announced support for Intel-based modular communications platforms. UTStarcom also publicly stated their plans to develop solutions based on AdvancedTCA incorporating the Intel? Pentium? M processor as a platform basis for targeted network infrastructure solutions.
These add to the growing list of telecommunication equipment manufacturers (TEMs), network equipment providers (NEPs) and service providers moving away from costly specialized, proprietary systems toward actively adopting standards-based platforms to deliver new services with faster time-to-revenue.
In this year, Intel also unveiled the Intel? NetStructure? Host Media Processing Software release 1.2 for Linux, which is the first high density, commercially supported media processing software offering the flexibility and value of an open platform. In addition, Intel unveiled the second generation 1U Carrier Grade Server, which offers TEMs and service providers 30 percent greater performance at a 20 percent lower price than the previous model.
In addition to bringing products to market sooner, using standard components allows TEMs and NEPs to focus development efforts on their areas of expertise such as deployment of new services, equipment availability and reliability.
Growing Asia Pacific
Businesses and consumers across Asia continue to fuel the need for Intel microprocessors with the region becoming a key factor in the company’s success. The Asia Pacific region accounted for 21 percent of Intel’s global revenue for the third quarter, the twelfth consecutive quarter in which Asia Pacific has led the other regions. This is a testament to the tremendous growth and demand for Intel’s products across the region.
Intel continued its commitment to foster innovation in the region with the opening of the Intel Korea Research and Development Center this year. The R&D center focuses on advanced wireless communications technology, high-quality media coding, and next generation platforms for content distribution and consumption. The Intel Korea Research and Development Center provides an environment for collaboration among a variety of contributors including the Ministry of Information and Communication, ETRI and Korea's technology industry. The research and development center is making good progress on the harmonization of the WiMAX and homegrown WiBRO standard, the latter is a broadband wireless services standard co-developed by a group of Korean companies with the Telecommunication Technology Association.
Intel's strategic investment program, Intel Capital, is one of the largest worldwide corporate venture programs investing in the technology segment. This year Intel Capital invested in companies that supported its connected PC and convergence in communications vision. In Asia Pacific, this included companies that specialize in doing research and development works for infrastructure, content solutions, servers and networking.
Country specific Intel Capital announcements in 2004 include:
PRC: Comlent, Haihui
Korea: Integrant
Taiwan: System General
Intel also continued its commitment to communities across Asia Pacific with programs such as the Intel Teach to the Future program and Intel International Science and Education Fair. Since the start of the Intel Teach to the Future program, more than 1.9 million teachers have been trained globally, of which close to 950,000 teachers were from Asia. This unique program helps both experienced teachers and pre-service teachers integrate technology into instruction to develop students' higher-level thinking skills and enhance their learning. In 2004, 1,300 students from 41 countries competed in the Intel International Science and Engineering Fair, the world’s largest pre-college science fair. Yuanchen Zhu of China took home the top prize and was named an Intel Young Scientist, this was the first time an Asian student received such high distinction.
Looking forward to an innovative 2005
The benefits of converged technologies will be felt in 2005. Many companies are working with Intel to develop standards, invest in innovative technologies (see Boxout 1 and Boxout 2) and help build infrastructure. The realization of all three means converged technology will become more widely available.
With convergence, every device, such as a mobile phone, PDA and notebook, will communicate with each other seamlessly, easily. There are two types of convergence occurring — micro-convergence and macro-convergence. Micro-convergence is the collapse, the bringing together of things at the smallest scale. An example would be Intel moving from the 90nm silicon process technology to 65nm, which allows for more transistors to be fitted onto a piece of silicon. This level of micro-convergence dramatically reduces the cost of devices which leads to much lower price points while enabling all sorts of new capabilities.
Micro-convergence also leads to a level of macro-convergence. Intel is working on technology innovations in modular communications platforms and wireless connectivity that change the face of telecommunications. Intel is enabling service providers to deliver new services quickly; providing the foundation for scalable, reliable solutions and decreasing operational expenses to drive profitability.
A buzzword on everyone’s lips is “WiMAX.” Over the past 12 months the industry has put tremendous effort into exploring the potential of WiMAX. Intel has disclosed its vision to speed the development of broadband networks through wireless technologies which will enable long-distance, high-speed wireless Internet access for homes and businesses. WiMAX provides a standards-based approach to building high-speed wireless broadband networks. Standards-based technologies generally help reduce costs and foster interoperability, which leads to broader deployment of technologies. Next year, a new wireless broadband chip, code-named Rosedale, will be available to the market, and is expected to be the first “system-on-a-chip” design for cost-effective customer premise equipment (CPE) that supports IEEE 802.16-2004.
Going forward, Intel’s strategy remains the same: invest in leading-edge capacity, develop innovative new products, and target growth opportunities in Asia and worldwide.
BOXOUT 1:
Intel is working on a number of exciting new products and technologies for 2005 that will help accelerate the convergence of computing and communications:
Intel's Centrino mobile technology platform codenamed “Sonoma” is expected to include a new Pentium M processor, with a faster, 533 MHz front-side bus and integrated 802.11a/b/g wireless LAN capability. Its new chipset, code-named “Alviso,” will support third-generation graphics. Other Alviso features include Intel High Definition Audio for enhanced audio capability and Intel Display Power Saving Technology 2.0 that can reduce display backlight power. The new mobile platform will be a mobile entertainment center for the digital home and a high productivity solution for the digital office.
A new wireless component, code-named Rosedale, will become available next year as a highly integrated silicon device in an effort to streamline the design process and reduce the cost of customer premise gear. It allows system designers to quickly and cost-effectively develop customer premise equipment (CPEs) for WiMAX networks. The integration feature reduces the size of the electronics since there are fewer chips required, and speeds validation and testing of the device, allowing system designers to develop CPEs more quickly and easily.
For high-end server systems, Intel disclosed plans for the new Intel Xeon processors MP based on the 90 nm process, codenamed “Cranford” and “Potomac,” which are expected in the first half of 2005. The products will include Intel Extended Memory 64 Technology (Intel EM64T) and Demand Based Switching with Intel Enhanced SpeedStep? Technology. The new platform can help IT executives manage expansive computing assets and security and deploy infrastructure in support of an increasingly mobile and global workforce.
Multi-core technology is expected to arrive in high-end systems with a dual-core Intel Xeon processor MP codenamed “Tulsa” and Itanium 2 processor codenamed “Montecito.” An enhanced Itanium 2 dual-core processor, codenamed “Montvale,” will be the first Itanium processor based on the 65 nm process technology, and is planned after Montecito.
Farther out on the roadmap is a multi-core Intel Xeon processor MP, codenamed “Whitefield,” and its multi-core Itanium 2 processor counterpart, codenamed “Tukwila.” Whitefield will share a common platform architecture with Tukwila.
For two-way servers and workstations, Intel will provide “Irwindale,” the codename for a follow-on processor to the recently introduced Intel Xeon processor at 3.6 GHz. Irwindale is expected to give customers a performance boost when compared to previous Intel Xeon processors because of a faster clock speed and larger two megabyte cache.
BOXOUT 2:
Running parallel to product innovation is Intel’s continued investment in research and development. Innovative, cutting-edge technologies that Intel is exploring in 2005 include:
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