Mission Matters

Paul Otellini Talk

 

It's appropriate that we are here today honoring the centennial anniversary of the Engineering School.  This being a Catholic institution, I thought I would begin with two confessions.

First, as you probably learned from Professor Yang's introduction, I'm not a graduate of the school.  And second, despite the fact that I have spent my career surrounded by engineers, I'm not an engineer myself.

That said, I do feel particular kinship for this place, and this program.  I've spent my entire professional life just a couple of miles away, and I've been a visitor to this campus many, many times.  Some of Intel's finest employees are graduates of Santa Clara.  And, as you've heard, my daughter is a sophomore here.  She's following in a fine family tradition of Jesuit education, as I attended a Jesuit prep school, and a Jesuit university just 50 miles from here in San Francisco.  So as a result, I have all the personal and a professional interest in the engineering program here.

When you were kind enough to extend an invitation to me to be part of the speakers program, I was excited to accept.  But I should also add that there's another reason that I wanted to join you today.  The theme of the series, engineering with a mission, is perfect.

A century ago, many saw engineering as the most utilitarian of professions.  Engineers built things.  They designed things.  They solved structural and mechanical problems.  And as a result, engineers have had a hand in shaping most of the significant advances in human history.  Without engineering breakthroughs, there would be no steam engine, no Golden Gate Bridge, no modern electricity or plumbing.  Engineering put a man on the moon and, more importantly, returned him safely.

Today, of course, engineers still create breakthrough projects.  But increasingly, engineering sits at the heart of the changes that we see in every field -- infrastructure, energy consumption, urban design, manufacturing, or the field I know best -- technology.  Engineers are driving the future.  I first recognized this when I arrived at Intel fresh from an MBA program nearly 40 years ago.  Solving problems and doing what everyone said couldn't be done was precisely the spirit of Silicon Valley.

And much of it is due to the energy and insights of two great men that I was privileged to work for.  Bob Noyce and Gordon Moore founded Intel in the 1960s.  Both were engineers.  And above all, they were visionaries and innovators.

Bob Noyce had 16 patents to his name and pioneered the integrated circuit.  Gordon recognized that with continued invention and innovation the device would change the future.  In fact, he even developed a formula for it.  That formula effectively charted the future.  We call it Moore's Law.

Moore's Law is not a scientific principle.  Instead it was, and still is today, a brilliant observation that is elegantly simple, yet completely audacious.  Moore's Law predicted that the number of transistors that could be placed on an integrated circuit would double every 18 to 24 months, and a doubling of its performance or capability would yield.  That was in 1965.  And it has done a better job than any other theory in determining the pace of our modern life.
 

It's also set a very high bar for innovation for all the engineers who work at Intel.  You see, Moore's Law at its heart is about predicting the future.  In its essence, it's a contract between the semiconductor industry and the society it serves.  As a result, Moore's Law is a constant motivating presence for our engineers, our designers, our manufacturers.  The question is never -- what have you done?  The question is always -- what will you do next?  It's a very high standard to meet -- smaller chips, better performance, lower cost.

Every new summit that's reached immediately confronts a cold reality -- how will we climb to the next one?  The pace of innovation, it turns out, is very demanding.  And as you might predict, every few years, someone suggests that Moore's Law has run its course, it has run into a wall.  The technological hurdles are too great.  We have reached the limits of physics.  We simply can't design a chip any smaller.  Every few years, I hear this.  And every few years, the engineers defy the predictions.  They devote their entire careers to keeping Moore's Law alive.  Because from the moment the implication of Moore's Law became understood, there's been a fear that it will someday end, in approaching the limits of physics.

In the early 1970s, Intel had a breakthrough, with the 4004 chip.  This chip had 2,300 transistors on it.  It was an engineering miracle.  Today, Intel makes approximately five billion transistors per second in our FAS.  You can put 100 million of today's transistors -- 22-nanometer transistors -- onto the head of a pin.  You can spread 4,000 of them across the width of a human hair.

This is the innovation imperative at work.  The world of engineering and innovation that today's students will inherit will take these breakthroughs much, much further.  If there's any great lesson I take from Moore's Law, it's that future innovation is always possible, always in doubt, and always demanding.

So while I'm always tempted to talk about the achievements of Moore's Law and the work at Intel, today I'd rather have you focused on the challenges ahead.  And specifically I want to address these challenges to our engineering students here in the room.  To be sure, the challenges will be technological.  You will be asked to push physics and manufacturing to levels no one's yet imagined.  But I also think you will inherit challenges that the advancement of computing has created for you.

And specifically, I want to talk to you about three challenges that face the technology industry.  They are technological, social and human challenges that confront Intel today.  And they will still be waiting for you when you enter the workforce a few years from now.

The first challenge is meeting the incredible demands of everywhere computing.  I'll explain what I mean by that in a few seconds.  The second is extending the benefits of technology to every person in the world.  And the third is ensuring that we have a pipeline of talented innovators for the foreseeable future.

These aren't the challenges you read about in engineering journals or scientific literature.  These are the challenges that spring from the success of Moore's Law.  Let me try to explain them to you one at a time.

First is the spread of what I called everywhere computing.  What is that?  Well, as we all know, computing has undergone a revolution in just the past decade.  The term "PC," or personal computer, no longer describes something that sits at your desk.  Computing is in our phones, in razor-thin laptops, in our cars, our televisions, and even in signs at the mall.  Indeed we've reached the point where we are transitioning from the age of personal computers to the age of personal computing.  This is a fundamental shift.

The first computers were static machines.  They stored data, and they made calculations.  And today, we think about computers as a way of connecting on Facebook or uploading video to YouTube, or Skyping with family and friends.  In a few years from now, our computing devices will enable experiences that most of us haven't even thought about yet.  Computing will become more engaging, more consistent, more aware.

By engaging, I mean that there will be new ways to explore, share and connect.  People won't wait for their device to search or to respond to them.  Devices will engage as fast as we can think.  Because access to the digital world will be available across any device.  The experience must be consistent no matter what device you use.  And your computing device will be increasingly aware of your preferences, so that it adapts to your needs rather than the other way around.

This is everywhere computing.  It is where technology is headed.  And all this will create remarkable convenience.  And, if we're honest, it will also create new challenges to our privacy and to our security.  This is inevitable.  And it's part of the great technology challenge that we face.

The number of new security threats identified every month continues to rise.  Almost 66,000 new instances of malware are identified every single day.  These are security threats that enter our computers, but also all the computing power in all the devices that we interact with in every moment of our lives -- in stores, in airport security systems, in our cars, on our phones; perhaps even in this auditorium.

Embedding security into a world of everywhere computing is a great, innovative challenge.  Because the truth is the hackers are proving just as innovative as the computer makers.  We have to make sure that our ability to innovate outpaces their ability to destroy.

And make no mistake about it -- this is a challenge.  At the very moment that computing has never been more accountable, it can also become more precarious.  Everyone here will work in a world in which personalized everywhere computing is taken for granted.  Our challenge -- your challenge as future engineers -- is making sure that it's as accessible, secure and trusted.

Secondly, speaking about the global reach of computing brings me to the next challenge.  Throughout most of its brief history, technology has been a story of the West and the developed world.  The next 10 to 20 years, though, is really about extending the same potential to the less developed world.

In my career I've had the good fortune of visiting emerging markets and experiencing their hunger for technology firsthand.  My purpose in traveling to these countries is not always to sell our products.  In some cases, many of the citizens there can't yet afford advanced technology.  Yet it's precisely these impoverished countries that would reap huge benefits from technology.  With access to technology, these nations can improve education systems and healthcare, stimulate economic development and enrich lives.  The needs for their citizens could be more easily met and, more importantly, their aspirations most assuredly stirred.

If technology is going to live up to its potential, the most important area for innovation is bringing its power to countries where it hasn't yet reached.  Technology, in fact, may be the single greatest economic development tool we have in our toolbox.

Let me offer just a single example of one of the many things Intel has done in collaboration with others to reach out to the developing world.  For the past few years, we've worked with engineers at the University of California Berkeley to develop what's known as a rural connectivity platform.  The challenge here was how to deliver Internet service to very remote areas where traditional Wi-Fi and fiber optic cable were not options.  Using a combination of antennas and wireless technology, these researchers have developed a system that can deliver connections across mountains or otherwise inaccessible terrain.  The technology is impressive.  The impact, though, is far more meaningful.

 We are already seeing eye centers in rural India that, for the first time, can process eye exam data through an online connection to a much larger clinic.  In Panama, we're creating the first Internet connections to rainforest villages.  This is just the tip of the iceberg.  This is a fundamental change in how modern services are brought to the most impoverished places.

In the past, the first question always was -- how will we get trucks there?  How can we build roads?  Technology is changing that conversation.  These are long-term projects.  But they are exactly the challenges that cry out for engineers who want a mission, who want to make a difference.

Technology today means more than a computer or a cell phone.  It means the building blocks of functioning and productive institutions -- hospitals, schools, roads, water sanitation facilities.  Today these are all technology investments that make the difference between an underdeveloped society and a country with promise.

But I don't view this challenging work as charity.  On the contrary, it's laying the groundwork for the next era of technology, an era where the technology is driving prosperity and health into every part of the world.

When I think about the future of technology, I come to what might be the most troubling challenge in our industry -- who will deliver all this innovation for the advancement of society?  Who will overcome the challenges of security and seamless connectivity?  Who will invest in our future?  For our own nation's wealth and competitiveness, I'm worried about the answer to these questions.

You and your classmates at Santa Clara are the exception, not the rule, I'm afraid.  The simple fact is that there is a chronic shortage of engineering students in the United States, threatening this country's role as the world's leading innovator and impeding our nation's fragile economic recovery.

Over the past 20 years, the percentage of engineers graduating in the United States has stagnated, while India and China surpass us with rapid progress.  American universities are not producing enough of the right kind of engineers to support the demand.  According to the National Science Board, growth in math-intensive science and engineering jobs outpace the overall job growth by three to one.  A McKinsey Global study released in June found that nearly two thirds of US employers reported that engineering and science-related jobs were the hardest jobs to fill, even in this economy.

Now, this is very good news for you as you look for jobs after you graduate.  Not such good news for our country.  If we don't produce [civil] candidates for these jobs, companies will go elsewhere in the world to find and fill them.

In the United States, 40 percent of the students enrolled in science, technology, engineering and math programs leave their program after the first year of college.  Engineering programs, as you all well know, are tough.  But a 40 percent rate of attrition is completely unacceptable, particularly that these individuals have already demonstrated both an interest and a capacity for engineering.  Fortunately, I believe this can be reversed.

As Professor Yang mentioned, I serve on President Obama's Council on Jobs and Competitiveness.  In that, I co-lead a taskforce to address the need for more American engineering graduates.  There are lucrative career opportunities for engineering students with specialized skills.  If we can increase the retention in graduation rates of qualified, interested students like you, we can move a long way to solving our shortage.

US companies can take concrete steps to inspire and encourage young engineers.  We can offer them the opportunities to experience firsthand the life of an engineer.  Why?  Because engineering is hard to describe, isn't it?  It's not like being a firefighter or a banker.  It's difficult to articulate what it means to solve the world's greatest problems.  So real-world experience is critical.

In fact, recently, over 55 companies, including Intel, have made the commitment that they will double their engineering internships next year.  This means an additional 7,000 young people will get a chance to experience engineering firsthand at a point in their lives where such --


Paul Otellini: -- at a point in their lives where such -- (audio gap)

But equally as important is your role.  The impact a mentor can have on someone new in the field is significant.  It gives the engineering field a relevancy and a vibrancy.  So I encourage you, upon graduation, to help other students or aspiring engineers understand what this means.  Create relationships, share experiences, and help inspire the next wave of engineers.  Because, as I've described here, technology innovation still faces challenges -- technical challenges, social challenges, and the constant challenge of making sure we're nurturing the innovation of the future.

I spent much of the talk today focused on the future.  Let me conclude with some thoughts about the present.

I want to mention the present because, as everyone here knows, we live in a very uncertain time.  But in the world of engineering and technology, this is actually a very hopeful time.  The challenges I described make this a more exciting world for engineers, not a frustrating one.  And I believe that much of Silicon Valley's enduring success has been its ability to continue to reinvent itself in the face of a changing world.  This is often a difficult and disruptive endeavor.  But as anyone who's worked in Silicon Valley knows, it can be exactly the right environment for new thinking and breakthrough innovations.

This is how you should view your own time and your own careers.  The noise of economic uncertainty, the threat of competition, doesn't phase the process of innovation.  It's a fundamentally forward-looking profession.

I consider myself fortunate.  I landed in what is ultimately the most optimistic industry there is.  Because Moore's Law assumes that next year will be better, faster and more productive than the year before.  And it lays out the challenge that Bob Noyce coined so eloquently -- "Don't be encumbered by history, go out and do something wonderful."

Today I've set out just some of the challenges you may take on in your career.  But please, please don't lose sight of my broader message.  Innovation is the ultimate driver of progress.  It's that simple principle that guided Intel's founders and will guide our inventors into the next 40 years.  And I truly, truly hope it will guide your future.

Thank you very much for the honor of speaking to you today.  And I'd be more than happy to take your questions.

(Applause)

Cary Yang: Thank you very much, Mr. Otellini, for a wonderful talk.

And what we're going to do today is going to be a little different in taking questions than previous President's Speaker Series.  We're going to be actually taking the questions directly from the audience, and using microphones in each of the four aisles.  And we'll have volunteers in each aisle.  So we'll ask you to go to the aisle, actually go to the aisle nearest you.  And [going to] be holding the microphone for you.

So before that, let me take the prerogative as the introducer to ask the first question.

Mr. Otellini, you talked quite a bit about innovation.  And this kind of [an island], internal and integrated circuits.  It's probably mentioned as often as the other two.  In your field, the United States clearly has an edge and innovation in almost all technologies.  However, we all also know that many of the labor-intensive technology jobs are not here.  This [contribute] (inaudible) problem we have in economy.  You have actually mentioned quite a few very excellent points that address the issue.

I just wanted to ask you what your thoughts are currently.  Because obviously, we have some serious, as you said, short-term problems -- the economy.  While US continued to be the technology leader, at the same time, how do you [keep] the short-term labor-intensive job to be at home, as much as possible?

Paul Otellini: I think the real answer to that question you won't like, which is -- you don't.  The United States is not ever again going to [be] the cheapest place to do anything.  And when you talk about labor-intensive jobs, costs on a [global] scale is what matters.  Doesn't mean that there can't be manufacturing jobs.

So for example, the jobs in the Intel factories in this country are manufacturing jobs.  I don't consider them labor-intensive.  The typical factory worker at Intel has two years of college.  Many have degrees.  Factory workers, [non-exempt] people.  So these are people that are highly trained.  And what do they do all day long?  The build chips.  How do they build chips?  They run robots.  They make sure that our machines are so clean, so precise, so finely tuned that the cleaning room can operate the way it's supposed to.  That's not a job that I would call labor-intensive; that's brain-intensive.  And I think that even our manufacturing jobs are likely to be centered around people's brain power in this country, going over time, with few exceptions.

I think that we can do some things in this country to alleviate that.  I mentioned the ones about the Engineering School.  One of the biggest shortages we have, more so than engineering degreed students today, are people coming out of two-year colleges with the ability to run computer-aided design systems and so forth.  That's a junior college job.

And when you look at the unemployed base of this country -- 25 million people -- 25 percent of those people are from the residential housing industry.  They were carpenters, tile-layers, roofers, et cetera.  I don't know what you think about the construction industry going forward; I don't think it's going to bounce back anytime soon.

So what do you do with those seven million people?  Well, maybe we can get them into community colleges, and we can retrain them to do not chip design, but perhaps running a CAD machine, punching out sheet metal for companies and so forth.  Those kinds of jobs will pay well.  They'll pay very well.  And those are the kinds of jobs we have to focus on.  Trying to get iPad manufacturing into the United States is not going to happen in our lifetime.  We have to get used to that.

(Applause)

Cary Yang: Thank you very much.  We'll get the first question.

Unidentified Audience Member:
Hello.  Well, I can project.

Paul Otellini:
I can hear you.

Unidentified Audience Member: Okay.  My name's Felicia, a business management major from the Leeds School of Business.  Thank you.  I have a question for you, in terms of being not from an engineering background directly yourself, from an education standpoint.  Have you faced any gaps?  In your professional experience, have you bridged that to become not only a tech enthusiast but a leader?

Paul Otellini: You know, I think in a company like Intel, which is highly technical -- by the time you can reach senior management, even if you were a PhD in chemical engineering, you're irrelevant.

(Laughter)

The technology has moved.  You know, most of the advanced science that we're doing is coming from people coming out of school today, breaking the barrier in Moore's Law, going to computer science.  Senior managers have 10, 20 years or more work experience.  That means that when they got out of school, Facebook and Twitter didn't exist.  Google didn't exist.

So what's relevant for the future isn't so much the experience base of senior management today; it's the ability to hire and train and motivate the people coming in out of schools today.  That's why you see the best technologies bringing most of their hiring in from recent college graduates, which is why I think this is an acute problem.

In terms of a company like Intel and not having an engineering degree -- I've managed this stuff for nigh on four decades now.  I have found that sometimes the ability to ask the obvious question -- people come in to me and say -- I've got this great feature, and we've got this chip, can do this -- and I say great.  So why would anyone want to buy it?  What can they do with it?  And sometimes, that grounding of reality has been the most important thing.  I've got a number of examples that I won't go into tonight.  But I've found that to be a refreshing way to kind of bring the engineers to reality and understand that it's not just about the invention, it's about the application of the invention.

Unidentified Audience Member: Thank you.

Paul Otellini:
Sure.

Cary Yang: Next question?

Dean Sahn: Hi.  Thank you.  Thank you for coming today.  My name's [Dean Sahn], and I graduated last year, and now working (inaudible) here in the valley.  And my question has to do with the connected devices you mentioned and how these devices are becoming more dynamic.  They're learning what we want to see, they're sourcing out some content that's more relevant to us.  And while that's exciting, it also creates a bit of a problem.  Because we see what we already know we're going to like, which means we're not seeing some stuff that may push us or cause us to ask questions.  And I'm sure as these connected devices become more ubiquitous, there's going to be other sort of ethical questions like that.

And my question to you is -- is there a point where technology needs to include -- either by hardwiring it or coding it into the product -- some level of ethical or moral standards?  And are we at that point yet?

Paul Otellini: Well, the ethical or moral standards -- I mean, it's hard to define good and bad on some of these things.  Let me give you an example.  Security and privacy are two sides of the same sort.  One man's privacy is another man's security.  Very often, the way you get privacy is to -- you may have to -- if you want information and so forth, you may have to sacrifice, so you have a balance of these things.

But my answer to your question would be no, and I wouldn't want to do that.  I don't think the machine [should do it].  At the end of the day, we have a choice.  It's like the choice I made when I came out here -- I turned my phone off.  Technology can go away with a switch.  And I think it's important for us to remember that.

So, I still read newspapers, even though I'm totally addicted to the technology, because of that randomness of not knowing what I don't know that I might find in that next page of the paper.  The Web doesn't give me that experience as easily.

And so I think we have a responsibility as users of the technology to keep that randomness, that degree of curiosity, in our lives, such that as the machines are more and more tailored to our preferences -- which is your inference and my assertion -- that we have the ability to turn it off or find alternative means of information.  I sure as heck wouldn't want to be God, in embedding moral codes into machines, which is what we'd end up having to do.

Cary Yang: (Inaudible).

Chad Walsh: Good evening.  My name is Chad Walsh.  I'm on the Engineering Alumni Board here, alumni of the Engineering School.  I also happen to be on a board of trustees for a community college.  So you've mentioned two things that are very near and dear to my heart.

I want to focus on one, and that is increasing the number of engineers that we produce through our universities.  That's a subject that I'm very passionate about.  And I'm wondering, in your work with the Obama Administration, have you done any outreach to local schools?  And do you have any recommendations on things we can do to make that happen?

Paul Otellini: Yes, the job program I talked about earlier, in terms of machine tools, is a direct part of that.  But I have to say there is no shortage of outreach programs in the federal government.  Yesterday, when I was in Washington, John Boehner told me there were 412 programs funded by the federal government to encourage math and science in schools.  Four hundred and twelve different programs.  Obviously, they're not working.

(Laughter)

You know.  So I'm worried when you say the government is involved.  I think this has to be one of these deals where, quite frankly, the people who need the kids to get this education have to be the ones to jump up and down and create pull, demand.  Employers have to be the ones to step up.

And I have been very positively encouraged by the response of American industry to that program I talked about, in terms of -- and 7,000 [in turn] shops is a big number.  I mean, we're committing over $100 million of our own money next year as collective companies.  And on top of that, we're going to fund mentoring programs in the colleges, both junior and engineering schools -- four-year schools over time, to help kids get the mentoring they need inside the schools.  I wouldn’t want the federal government to do that.

Chad Walsh:
Just because I'm on the Board at Mission College, which is right next to Intel, I just wanted to let you know --

(Laughter)

-- we just yesterday created a technology institute.  And if anybody from Intel wants to reach out to Mission College, we would love it.
 

(Laughter)

(Applause)

Diane Niklid: Good evening.  I'm [Diane Niklid].  And I would like to ask a question about -- might reveal a little bit about you, and mentorship.  Can you tell me, did you ever have a mentor?  Are you a mentor?  And a little bit of a personal story about that?  Because I have a feeling there is one.

Paul Otellini: Were you a reporter in your prior life?

(Laughter)

Diane Niklid: No, but I am curator of [Tenex] San Jose.

Paul Otellini: Oh, okay, okay.

The closest thing I have to -- I have two people I would consider mentors, that got me over some humps in my career.  One was Andy Grove, and the other was Arthur Rock.  And they both gave me incredible pieces of advice at the right point in time, that shaped my career -- worked out okay.

I take mentoring seriously, even though -- if you have seen, Andy has this article in Fortune last week saying he didn't like any word that ended in I-N-G.  Mentoring, teaching, training -- he didn't like those words.  He liked just having bosses tell people what to do in -- your responsibilities, to develop your subordinates.  At one level that's true.  On the other level, doesn't scale.

And so what I do now is I -- I mean, I feel a mentoring responsibility for my direct staff -- want to develop them.  And I would like to develop my successor out of my staff, so I don't have to work forever.  So I'm trying to do that.

More importantly, I have taken on direct mentoring of two people I pick at random every year from our underrepresented minority engineering teams.  These are people that are medium seniority.  And I won't embarrass them by telling you their specifics.  But I meet with them every other month, privately, and we talk about their career -- what they can do.  And part of it is coach, part of it is getting barriers out of their way.  And I find that very, very interesting.

In terms of the personal story, I think I don't have enough time to do that.

(Laughter)

Cary Yang: We'll take a question.

Alan Weissberger: Hi, I'm Alan Weissberger.  I'm the Chairman and President of the IEEE Communication Society and the Manager of IEEE ComSoc's global website.

Having lived in Santa Clara for 42 years, I can say with some conviction that I believe that Intel is the company that actually made Silicon Valley.  And I also think, having worked there twice as a consultant, that Intel is the best-managed company that I'm aware of in the whole world.  You personally, Mr. Otellini, intervened in an issue I had in the 1980s on an invoice and resolved that issue to my satisfaction.

(Laughter)
 

(Applause)

Alan Weissberger): [And I won't forget it.]

Paul Otellini: I didn't know where that was going.  That [was funny].

(Laughter)

Alan Weissberger: That is all the preamble.  I was working as a consultant to the Microprocessor group and ISDN group in Folsom.

But in any event, my question to you is on computing everywhere in mobile computing.  This is the one area that I've seen that Intel has totally failed.  From your dedication to WiMAX to the mobile Internet device, to the Atom processor, you have no design wins in Smartphones, in tablets, in any type of mobile gadgets.  So could you please tell the audience what is Intel's game plan to catch up in this new world of mobile computing that [you] talk very highly about?

Paul Otellini: Sure.  We're going to stay at it till we win it.

(Laughter)

Paul Otellini: We have -- I don't feel badly about missing tablets.  Because everybody else did, too.  And by the way, there are 15 tablets shipping today with Intel in them.  Nobody knows that, because there's only one tablet that sells in this world, and that's the iPad.  We're not in that.  The other ones [have] 103 tablets shipping in the world today.  iPad is one with volume, Samsung is the second one.

And so it's a very funny market road.  It's all nascent.  And this market is in the earlier of stages.  And I'm quite confident, particularly as Windows 8 comes out, that we'll do very well in tablets.

I'm going to get to phones.  On phones, I feel badly about.  Because we had an early position.  Fact, the first RIM device had a 386 in it.  Who knew?  And we didn't really do anything with phones.  We bought a business unit from Digital Equipment.  It came with an ARM chip.  That ARM chip went into phones, we sold them in there.  Couldn't make any money yet, but I sold that for $700 million several years ago.  I took that money, and I invested it in Atom for phones.  And those chips are coming out now.  First phones with Intel in them will be the first half of next year, so you'll be able to buy one.

There's a number of design wins.  But as you may know in the phone business, no one will announce a design win until they're ready to ship a phone, which means it has to be already through interoperability testing.  So you'll see significant number of announcements at my keynote at CES in January.  And if you want a ticket, I'll be happy to get you (inaudible).

(Laughter)

This market is in the early stages of development.  At the end this thing, I'm convinced we will be successful, if for no other reason -- because we have the world's best transistors.  And there's no place you need great transistors more than a phone, where you can cram the most performance, the most features, the longest battery into the smallest thing.  That's about the transistor, and that's what we're [invested in roll out].

(Applause)
 

Armandis Fuliargimandi: Hello, my name is Armandis Fuliargimandi.  I'm a freshman, and I'm a computer science major.  I just came all the way out to Silicon Valley from Philadelphia.  I love Intel.  I built my first Pentium 4 PC when I was 10 years old.  Just yesterday, I built a Sandy Bridge system.  And I'm looking forward to Ivy Bridge and Haswell and Ultrabooks, and all this awesome stuff that you guys have announced.

Paul Otellini: So you want a job?

(Laughter)

Armandis Fuliargimandi:
Obviously.

(Laughter)

Armandis Fuliargimandi:
My question is actually related to that.  So I’m a computer science major, and I have a lot of programming experience.  And obviously, at least the way -- from my perception is -- the way to work on these cutting-edge microprocessors is to become an electrical engineer.  But I love programming, and I have -- I'm very good at it, and I kind of want to build on my strengths.

So my question to you is -- what is the role of computer science in developing the highest, most cutting-edge chips, like Sandy Bridge, Ivy Bridge and Haswell?

Paul Otellini: Without software, we couldn't build the most advanced chips.  And going forward without deeply integrated software, hardware features and functionality, we can't build the most advanced platforms.  The days when you could just build a chip and throw it out there, and the world would add value around it, are long gone.

And so now, if I look at Intel today, we have 97,000 people, we have 25,000 software developers.  We are the fourth-largest software company in the world, as measured by people.  And I think that percent of our company that's software is only going to go up, not down, over time.

And when we look at a new product -- mentioned Haswell, or products beyond that -- we don't look at just the chip, we look at how that chip can be used in the system, how we can deeply integrate things like security or location-based services into that functionality in a way that delivers that seamless connectivity that the first person asked about.  And to me, that's all software.

So I think that should you want to work on the most leading-edge projects at Intel, you probably have as good a chance, if not more so, coming in from the software side.  Because that is our most critical resource right now.

Cary Yang: Take another question, please?

Renee Van Buren: My name is [Renee Van Buren].  And I'm an engineering alumni at Santa Clara University.  And I used to work at Intel, too.

Anyway, I noticed that recently you just announced PC powered by solar cell.  And I was wondering why you need to have a PC powered by solar cell.  And also, I wonder what is the percentage of your business that was done in emerging market?  And also, is affordable power supply an issue in this market that would help you expand more business?

Paul Otellini:
Well, the project  to have a Pentium-class processor running on a one-inch [clear] solar cell was a lab project.  And [why] we did that was to prove the potential of taking -- of creating very powerful machines that could have not just all-day life but weeks and weeks of battery life, and theoretically be charged off the sun and not the grid.  And so it's a proof-of-concept kind of product, with no production plans yet.

But if you think about the fact that things are going to get increasingly mobile -- I mean, the Internet of things needs notes on cameras, for example, in intersections, that you wouldn't mind having powered by the sun and not necessarily cables, and [not with a battery].

In terms of the second part of your question, on affordable power supplies -- I don't see that as being a limiter.  I've never heard anyone say that's a limiter today.  They're pretty cheap.

Cary Yang: We'll take one more question.

Unidentified Audience Member: Hi.  Thank you for being here.

In regards to your speech, the second major challenge that you spoke about was improving access to technology, you know, globally to those who don't currently have access.  I know Intel is doing a lot of great work in its corporate social responsibility effort, a lot of admirable projects.

My question is -- what changes do you think are necessary, or what would you like see ideally -- what could Intel do, or other companies do, to collaborate to improve the number of these types of projects or the quality of this type of work to meet that challenge?  Because I just [set] it as a challenge.

Paul Otellini: I'm sorry, what kind of project?  You mean the examples I showed --

Unidentified Audience Member: Yes.

Paul Otellini: -- or I talked about?  Okay.

Well, I mean, this kind of gets (inaudible) I did the part of the question I didn't get to answer, which is percent of the businesses overseas that are in emerging markets.  Seventy-five percent of our revenue's offshore.  The fastest-growing markets we have are emerging markets, where your question is more relevant.  My sense is that very few companies have the wherewithal to do these kinds of research projects.  And Intel does, and Google does, and Microsoft does.  Cisco does some of this.  But get beyond that in technology, and it's -- it really isn't something that they spend their time on.

So it's very hard to do.  To me, what you need to do is create a commercial viability.  So someone mentioned WiMAX earlier.  WiMAX ended up not being a commercial success.  But the technology that was developed to create WiMAX -- which is a version of OFDM telecommunications technology -- led to 4G, which is LTE.  And I'm convinced today that the world is getting 4G a decade or two sooner than it would've gotten it had we not done WiMAX.  Because we forced the hands of the telecommunications industry to go to 4G.

Once you go to 4G, you start making 3G more affordable, which is now being pushed into countries around the world at very low costs.  And so the capitalist system is working quite well in getting cell towers in India in a very affordable fashion that weren't there just even several years ago, as companies raced to deploy more modern technologies in pretty cost-effective fashions.

I think that's probably the model -- is figure out a way to get this technology so cheap it becomes pervasive, as opposed to trying to do these point projects that are more examples than they are moving the needle.
 

Cary Yang: Thank you very much, Mr. Otellini.

(Applause)

Before we adjourn tonight, I'd like to thank our speaker for an insightful speech as well as answered your questions; our host, [Bob Eng]; and all of you for being here.  I invite you to join us for the upcoming President's Speaker Series, which you can find in your program, as well as the events that celebrate our 100th anniversary of our School of Engineering, which will be on the website -- School of Engineering.

As we embark on the second century of the engineering mission, a lot more to come [at our] school.  I hope that you can share with us in some of those.

So as you depart, I would like to remind you about this contact card that you have in the program.  Please fill that out and drop it off in our boxes.  And if you do, you'll be eligible for Barnes & Noble $100 gift certificate.

(Laughter)

Cary Yang: Again, one more thing, which is a small token of appreciation I'd like to present our speaker with a small gift.

(Applause)

This small token of appreciation.  And I'm not sure that's the label [intern sign].

(Laughter)

(Applause)

    
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Spring 2012

Table of contents

Features

Bucky Bronco Confidential

Who wears the costume today may be classified information. But here's one secret revealed: how Bucky came to be.

Why women professors?

Marking 50 years of coeducation at Santa Clara—and recognizing that it’s not just the composition of students that has changed profoundly.

Mission Matters

Here comes the sun ... and our solar decathletes

The 2013 Solar Decathlon is on! Santa Clara is competing for the third time, after third place wins in 2007 and 2009.

Bigger than all of us

Baseball Coach Dan O’Brien goes old school. He wants players—and fans—to rekindle a love affair with the game.

Opening new doors in the Philippines

Introducing Casa Bayanihan—a place to learn, work, and be changed forever.