Intel’s Paul Otellini’s departure underscores future challenges and past successes of chip giant

Maybe the most remarkable thing to ponder as Intel CEO Paul Otellini announces his May retirement is the length of time the guy spent at the Silicon Valley chip-making giant.

Thirty-eight years. Amazing.

“I’ve been privileged to lead one of the world’s greatest companies,” Otellini said in Monday’s news release. “After almost four decades with the company and eight years as CEO, it’s time to move on and transfer Intel’s helm to a new generation of leadership.”

Otellini started at Intel in 1974, only six years after the semiconductor company was launched with a typo-ridden one-page business plan by Robert Noyce. Co-founder Gordon Moore has often pointed out that the business plan, which led to a $2.5 million investment, really didn’t say much of anything at all.

Anyway, Otellini’s move to step down (years earlier than expected) underscores the historic importance of the company that descended directly from Fairchild semiconductor.

Intel was a memory chip company when Otellini, 63, signed up, despite having just come up with the 4004 microprocessor (the computer on a chip) in 1971, through the work of Federico Faggin, Ted Hoff and Stanley Mazor.

It’s easy, as Intel rolls along decade after decade, to lose sight of what an unusual Silicon Valley company it’s become. Consider Otellini’s tenure. Who stays at a tech company for 40 years?

But the halls of Intel are filled with engineers and executives who have been there for the long-term even as the business changes at a fast-twitch pace.

The processor business, of course, eventually became pure gold for Intel, a company that under Andy Grove dramatically shifted its business  from memory chips to microprocessors after a  near-death experience in the 1980s.

As Intel searches for the a new CEO — and the board has said it will look inside and outside the company — it may be at another inflection point. A number of  analysts and others are worried that the chip giant is missing the move to mobile devices.

I’m guessing there is going to be a little bit of pressure on whoever steps in to become only the sixth CEO in company history. Think of those footsteps: Noyce, Moore, Grove, the godfathers of Silicon Valley.


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