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October 23, 2008 3:11 PM PDT

Intel 'corrects' executives who slammed iPhone

by Tom Krazit

Intel's Shane Wall (left) and Pankaj Kedia probably shouldn't apply for jobs at Apple anytime soon.

(Credit: Suzanne Tindal/ZDNet.com.au)

Updated 4:30pm with additional background on the ongoing saga of Apple and Intel.

Intel issued a "correction" Thursday regarding comments one of its executives made earlier this week slamming the iPhone as incapable of working correctly with the Internet.

It's hard to see this as anything other than an formal apology to Apple and ARM for comments made by Intel's Shane Wall and Pankaj Kedia at the company's Intel Developer Forum in Taipei, as reported by our sister site ZDNet Australia. Among other things, the executives resurrected Intel's lame "ARM chips can't handle the Internet" argument and singled out the iPhone as an example of a smartphone that could be really awesome if it only used one of Intel's low-power x86 architecture processors, known as Atom.

But in a posting to Intel's Chip Shots blog Thursday afternoon, Anand Chandrasekher, the head of Intel's low-power efforts, threw his fellow executives under the bus in admitting that Intel's current low-power x86 processors don't even come close to matching the power consumption numbers--a vital design parameter in smartphones--of those made by ARM's partners, which are used in smartphones like the iPhone and over 90 percent of all the mobile phones in the world. The post follows in its entirety.

Anand Chandrasekher issued a correction on comments made by members of his team yesterday at Intel's Developer Forum in Taiwan. As general manager of the Group responsible for Intel's ultra-mobility products, he acknowledged that Intel's low-power Atom processor does not yet match the battery life characteristics of the ARM processor in a phone form factor; and, that while Intel does have plans on the books to get us to be competitive in the ultra low power domain - we are not there as yet. Secondly, Apple's iPhone offering is an extremely innovative product that enables new and exciting market opportunities. The statements made in Taiwan were inappropriate, and Intel representatives should not have been commenting on specific customer designs.

Whoops.

Apple has made it pretty clear that it doesn't buy Intel's argument that since the PC-based Internet experience runs on x86-architecture processors, the best way to bring that experience to the mobile world is to adopt x86 processors. Apple purchased the engineers of P.A. Semi earlier this year to start working on processors based on ARM's cores for future iPhones and iPod Touches, rather than waiting for Intel's Moorestown product--the chip Chandrasekher was referring to in his post--to arrive.

Intel has been making this argument for over a year, but it had avoided slamming high-profile ARM-based smartphones such as the iPhone during extremely public events like IDF. And now we know why; a certain Apple executive said to be close friends with a certain Intel executive was unlikely to be pleased by Intel's comments just as Apple was reporting blowout iPhone sales.

The apology raises the question of just how strained the relationship between the world's largest chip maker and Apple, who have now been partners for a little over three years, has become this year.

For the most part, the relationship has been mutually beneficial. Apple got the notebook processors it desperately needed to upgrade the iMac and the MacBook, as well as a totally committed chip partner, and the results have been stellar. For its part, Intel hooked up with a partner that wasn't totally dependent on the chip company for innovation and that had dramatically more sex appeal than Hewlett-Packard, Dell, or Acer.

Ever since June 2005, Intel executives have been positively giddy about their relationship with Apple, p romising that all sorts of whiz-bang-cool gadgets would soon arrive jointly developed by the style wizards in Cupertino and the engineering wizards in Santa Clara and Oregon. The two companies were said to have engineering staffs that bonded over a common love for innovation, and Intel salespeople were ecstatic at showing off how their technology could be used in leading-edge designs.

But Apple doesn't toe Intel's line the way the rest of the PC industry does. It doesn't need Intel's marketing war chest, it doesn't need its cadre of design engineers, and it doesn't need Intel's brightly colored stickers to help sell its products, as CEO Steve Jobs reminded the poor reporter who dared ask last year why Apple doesn't participate in the Intel Inside program.

Apple has shown that it is quite willing to follow its own path. The purchase of P.A. Semi was a clear signal that Apple had taken a look at Intel's future road map for low-power processors, and decided it had to take matters into its own hands regarding future chips for the iPhone and iPod Touch. And while Apple is unlikely to dump Intel's processors anytime soon from the Mac lineup--especially given the struggles of Advanced Micro Devices this year--its decision to use Nvidia's integrated graphics chipsets in the newest editions of the MacBook underscores what everyone in the PC industry knew anyway: Intel's integrated graphics chipsets are the bottom of the barrel.

Meanwhile, the Intel-based gadgets co-designed by Apple and the chipmaker are nowhere to be found. Intel had probably hoped that it could sell Apple on the Netbook or Mobile Internet Device concepts that it has been flogging for the past two years, but Apple has sensibly concentrated its efforts on the iPhone and Mac rather than helping Intel get its ideas for mobile computing off the ground.

So where does that leave the two companies? They'll be fine, although Intel is sleeping on the couch tonight. This week's exercise, however, is an interesting example of how much power Apple wields over one of the most important and historic companies in technology.

Intel has never apologized for slamming IBM's Power server chip--a competitor to its Itanium processor--while simultaneously selling IBM Xeon chips for a different class of servers. But one offhand remark surfaces about Jobs' iPhone, and Intel bends over backward to smooth things over.

Tom Krazit writes about the ever-expanding world of Internet search, including Google, Yahoo, online advertising, and portals, as well as the evolution of mobile computing. He has written about traditional PC companies, chip manufacturers, and mobile computers, spending the last three years covering Apple. E-mail Tom.
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by sanenazok October 23, 2008 3:34 PM PDT
SO this guy's blog is the "official" apology from Intel? Wow, this suddenly means a lot of things are official...
Reply to this comment
by Tom Krazit October 23, 2008 3:44 PM PDT
It's an official Intel company blog. But just in case you were worried, an Intel representative confirmed it was legit.
by Mr. Dee October 23, 2008 3:41 PM PDT
I think two Intel executives just got pink slips or a good old demotion. I too think their comments were inappropriate. If I were Steve, I would have called Paul and tell him to fire them and on top of that punish Intel by not using their technology in future versions of the iPhone and iPod Touch.

Yeah, I'm that harsh.
Reply to this comment
by Xtoo October 24, 2008 8:42 AM PDT
Harsh decisions will make lose business and good employees. You have to be smart about it. Harsh and bad-ass is not smart.
by Galaxy5 October 23, 2008 3:45 PM PDT
I told you someone was gonna get a nastygram from Otellini.
Reply to this comment
by daedbird October 23, 2008 4:10 PM PDT
Hey Mr. Dee, I don't think Steve Jobs needs to tell the top dogs at Intel if these two doofuses should be fired. I am sure Paul and the rest execs at Intel already started looking at these guys, and probably wondered 'Do you guys work in the technology sector? Do you ever leave your offices and see what's out there?" I mean, I think even my 98-year-old great aunt Mary has heard of the iPhone and heard its pretty spiffy on viewing the web. The iPhone may have its faults but, no one ever said that it sucked looking at the web....

Seriously, do the guys that said this even work on the Atom project? Everyone there seems to admit its still a couple years away from the handheld market.

Oh, and Mr. Dee....The punishing of Intel would be SO old Steve Jobs. This is Jobs 10.4, who got a sweet deal with Intel for chip prices, not promoting them with those ugly centrino stickers, got them to give his company first dibs on smaller processors for the AIR, and rarely mentioned Intel's name while promoting the new Nvidia chipsets in the new Macbooks. Jobs 10.4 knows that working with Intel, especially after burning bridges with PowerPc partners IBM and Motorola and watching AMD downsize, that Intel may be the only partner on the dance floor. Plus, keeping quiet right now probably means a next-gen Atom in an Applet (my name for the Apple netbook) within the next year.
Reply to this comment
by JoeF2 October 23, 2008 4:54 PM PDT
And the deal probably got a bit sweeter after these comments...
by montex66 October 24, 2008 12:39 AM PDT
I'm pretty sure that Mr. Jobs is at 10.5.5 these days.
by Mr. Dee October 24, 2008 11:25 AM PDT
@: montex66:

Most likely 10.6 :)
by Randys2cents October 23, 2008 4:38 PM PDT
and lets not forget that twenty-five billion in the bank that Steve has amassed. For a petty ten billion, you
can get yourself a brand new 450mm fab right in Cupertino. Just a thought.
Reply to this comment
by Tom Krazit October 23, 2008 5:07 PM PDT
Interesting idea, but the ongoing expense of staffing one of those things and keeping it up-to-date is staggering, which is why AMD has said no mas. And if iPhone demand took a turn for the worse, they'd be sitting on a huge cash drain.
by Vegaman_Dan October 23, 2008 5:48 PM PDT
It is refreshing to see a company do the right thing and issue a public correction like this. Many IT companies of note could benefit from this sort of thing including those from Cupertino and Redmond.
Reply to this comment
by Penguinisto October 23, 2008 6:06 PM PDT
Kinda surprised, but then again... glad someone removed the exec's head from his, well... you know.

/P
Reply to this comment
by jeffc3nc October 23, 2008 6:26 PM PDT
The thing that gets me.. is not only are the comments inappropriate, they're incorrect.

The web was invented on Unix workstations (CERN used Next workstations at the time), and Windows support was an afterthought. Think about the time before Netscape 1.0 showed up.

The "web experience" those guys talk about has nothing to do with the x86 architecture and everything to do with Microsoft's monopoly and non-standard Internet Explorer extensions to HTML and DOM.
Reply to this comment
by newnewsreader October 24, 2008 2:51 AM PDT
Very much to the point!
by Holly Klug October 23, 2008 6:38 PM PDT
I suppose Intel is crying because they sold their ARM stuff to Marvell. Sounds like sour grapes to me.
Reply to this comment
by vip_m October 23, 2008 7:58 PM PDT
This reminds of the time Steve Jobs visited with Disney and bawled out Disney's technology officer for insisting they standardize (this includes creative production) on Windows machines. I heard Steve screamed at the guy and told him this was why Disney's movies were crap (this was before the Pixar takeover), because they were using lousy machines.
Reply to this comment
by newnewsreader October 24, 2008 2:49 AM PDT
Go on please, this sounds very interesting.
by WhuzYoDaddy October 26, 2008 7:46 AM PDT
Yes - do go on. But please provide a link to the source of this "info".
by zato_3 October 24, 2008 12:02 AM PDT
The part of this that's hard to understand is why the 2 bozo's would have made the negative statements about ARM. They had to know that reporters would report, and the story would be all over the internet within hours. They had to know that Steve Jobs and Apple would not be happy, not to mention ARM and all who use ARM chips (Samsung, Motorola, Freescale, Fujitsu, etc.). Why make so many enemies, especially over stupid statements? I can't help thinking that this didn't just happen, someone made it happen.
Reply to this comment
by j6EUV October 24, 2008 8:02 AM PDT
I am surprised to see Intel executives bad-mouth their customers' products. The censor machine of Intel (including Intel Legal department) used to be very careful about what you can say and cannot say in public. I guess these executives did not use PowerPoint slides; therefore, there was no way to examine their talk before the presentation. That is extremely dangerous for Intel. I agreed that these two executives should be let go or demoted.
Reply to this comment
by ittesi259 October 24, 2008 8:57 AM PDT
Can you imagine all the other executives saying "Damn it you idiots! You **** him off any more he'll drop us and go back to PowerPC Chips just to spite us!!"

Ok thats unlikely given the popularity of being able to use Boot Camp for Windows and such....but it'd be funny to see what happened in the executive board room.
Reply to this comment
by Seaspray0 October 24, 2008 9:59 AM PDT
Not likely. The x86 archetecture has proven too benificial. They would consider AMD before going back to the PowerPC chip.
by whizkid454 October 26, 2008 8:11 AM PDT
Typical. I expected this to happen because Intel knows Apple is doing very well lately and they want to keep good relations with them.
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