Intel's disruption is now complete
jamesallworth.medium.com
jamesallworth.medium.com
The Iron Law of Bureaucracy
> Pournelle's Iron Law of Bureaucracy states that in any bureaucratic organization there will be two kinds of people":
> First, there will be those who are devoted to the goals of the organization. Examples are dedicated classroom teachers in an educational bureaucracy, many of the engineers and launch technicians and scientists at NASA, even some agricultural scientists and advisors in the former Soviet Union collective farming administration.
> Secondly, there will be those dedicated to the organization itself. Examples are many of the administrators in the education system, many professors of education, many teachers union officials, much of the NASA headquarters staff, etc.
> The Iron Law states that in every case the second group will gain and keep control of the organization. It will write the rules, and control promotions within the organization.
https://www.jerrypournelle.com/reports/jerryp/iron.html
This (and other organizational failures and technological innovations) is why there will always be startups and small businesses eventually where there was once a big entrenched business or two (or sometimes three).
There is also, of course, whole new industries and niches to be created out of nothing, value and wealth is never a finite pile. It's mostly a matter of human effort to find and break out these new areas. Sometimes just reinventing things as the old talent grows old and dies off, providing value in learning history.
1. The only thing that matters is the budget.
2. Bureaucracies only grow, never shrink, and the only thing you can control is the rate of growth.
Thanks for sharing another one with us!
Edit: thanks OP for continuing to post this link, I as well found it enlightening :)
Strong claims like that require strong evidence and a theory of WHY that would (always) be the outcome.
I'm thinking of society as large. That is an organization too. Are we doomed by bureaucracy?
And there's always corruption and politics where there are humans, be it in the mailroom or the boardroom.
Term limits are best implemented where someone must take on a different job every x years. This doesn't solve the problem of entrenched vampiric bureaucrats entirely, but it at least pushes them towards the chopping block.
Liquid democracy is a type of democracy where people give their voting power for particular issues to whoever they trust most for that topic. Then that person may pass the cumulative votes onto someone they trust and believe in. The point of liquid democracy is to empower people who are actual experts in a subject. Rather than having laymen vote in ways that just empower the most socially adept.
The entire skillset involved with gaining power is so time-consuming, it's incredibly rare for someone to have it and an actual technical skill at the same time.
When the company becomes successful and starts to grow, it starts to attract people who don't really care about the company and its mission—they are in it only for themselves. They only want to improve their lot, and are willing to play politics and backstab as required to get ahead..
If the company is only growing slowly, they can weed these types out during the interview process. But if they are growing quickly, they don't have time to interview properly and slowly and surely the company is transformed from a cooperative, mission-driven organization to one where employees are fighting against themselves.
Unfortunately these politically minded types are the ones who quickly rise up the ranks, and once most of the top areas of the company are populated by assholes, there is no cure.
In the history of the world, 99% of people has been "in it" for the salary. Who gives a rat's ass about the company or the product?
If you're in a competitive market you're forced to innovate.
If you're a monopolist you can just sit there and extract wealth. Which Intel was for a while.
By the way, your little theory has support and a name, it's the resource curse in political economics.
When billions are raining from the sky, whether you do good work or not, the rational plan is to fight over those free resources, rather than work to create new ones.
None of the options for dealing with this seem great. I've seen "internal incubator" type things which are designed to come up with new ideas, but honestly I'm not a fan of these. The structure incentivizes prototyping new "left field" ideas, but those ideas are likely not to gain any traction, and if they do, it is likely to be a mess to transition them into real projects within the more normal operations of the organization. And it does nothing for projects that are clearly important from inception, even if new; the "left field" incubator is not the right place to put something that isn't a crazy idea being tested but something known to be important.
I think a similar thing is happening at Amazon (the strong dictator stuff, I mean), and it's my hunch that Google has started following Intel's trajectory, they just haven't realised it just yet.
having worked at all three of
A Trillion Dollar corporation
A smaller company that grew quite a bit and sold for $5 billion+
A start up now
*
People optimize for what will make them rich/wealthy
In larger companies, the ENTIRE function of middle management is to extract wealth and not create it
In some ways it's a miracle Microsoft managed to get Satya Nadella as CEO. Normally the people who rise up the ranks are the politically astute
Don't discount Nadella's political astuteness. I think it would be more accurate to say he is not merely politically astute, but instead able to combine his skill at internal politics with customer empathy and technical intelligence.
Extremely well said, and having worked at two (initially) successful behemoths so far, I couldn't agree more.
Steve Jobs apparently demolished internal units, with the following outcome:
> As was the case with Jobs before him, CEO Tim Cook occupies the only position on the organizational chart where the design, engineering, operations, marketing, and retail of any of Apple’s main products meet. In effect, besides the CEO, the company operates with no conventional general managers: people who control an entire process from product development through sales and are judged according to a P&L statement.
https://hbr.org/2020/11/how-apple-is-organized-for-innovatio...
Most corporations are organised around product groups, but what happens when the mobile products group comes up with a new device and wants to sell it to corporate clients? The enterprise products division might not like that. Imagine if Apple had a Mac division selling laptops, they might not have been happy about the Phone division coming out with the iPad and keyboard cases.
Now that it's been a while, it wouldn't totally shock me if they ended up drifting Intel's way eventually.
Now if there were a technology to come up agains the iPhone (glasses anyone?) they'd probably face the same conundrum; disrupt themselves or be disrupted?
Maybe because it's newer and hasn't rotted yet.
First, there will be those who are devoted to the goals of the organization. Examples are dedicated classroom teachers in an educational bureaucracy, many of the engineers and launch technicians and scientists at NASA, even some agricultural scientists and advisors in the former Soviet Union collective farming administration.
Secondly, there will be those dedicated to the organization itself. Examples are many of the administrators in the education system, many professors of education, many teachers union officials, much of the NASA headquarters staff, etc.
The Iron Law states that in every case the second group will gain and keep control of the organization. It will write the rules, and control promotions within the organization.
Pieter Hintjens (creator of ZeroMQ) wrote a lot about this, and how organizations from big companies to small charities to software projects ought to design their internal structures of roles, titles, voting, auditing, to defend themselves against this kind of attack. Particularly if there's any kind of treasury, an opportunist will become tempted to take that role, but any kind of credit will attract people who want to take the credit without doing the work, power structures will attract people who want the power, and programmers who "just want to code" and avoid politics will find themselves at the bottom of a dysfunctional infected organisation structure with no power, no credit, and being instructed by distorted requests.
IIRC he tried to design the ZeroMQ organisation so that there wasn't any way for one person to insert themselves in a key point.
I'm not sure where on his blog I was reading that, but it's related to his writings about psycopaths[1] as the opportunists, and might be part of his book Social Architecture[2]
I could be mistaken, but I think this kind of happened with ZMQ where one contributor got annoyed and went off to create nanomsg.
It means there's immense incentive for teams to monopolize skill and reduce other teams' value so they get picked. It also encourages posturing as strongly as possible, rather than accurately, since it's all based on perception - it's not like you can prove you'll do a better job than another team. To make it worse, if a highly valuable project seems like it might fail, the company will likely throw more resources at it - the risk to the team for getting in over their head is relatively low (and still looks great on a résumé), compared to the risk to the company.
Whereas, in a smaller company with a smaller pie to divide amongst folks, the growth of the pie is the most important thing.
Startup going well, productive team and people to work with.
Some guy who sucks with years of sucking experience joins to “manage” the company/team/department into the ground.
I work for a not for profit now and we get paid less, very few people suck.
Instead they optimize to many things like money, prestige, power, security, and so on. Much like you can't describe health as a single thing, when you collapse your insight to a single variable you miss everything in your simulation of how reality works.
This applies to an individual level but especially applies towards a cooperative level with multiple individuals. When we cooperate (or just act in ambiguous situations) sometimes trying to collapse your actions to "mental shortcuts" aka Heuristics in Judgment and Decision-Making to borrow some thinking fast and slow language further reduces insight.
A great example comes from this article. The group in charge of the Pentium product line would not be thrilled to see the Celerons launched, since that would cannibalize their sales. Obviously for long term success of Intel this was the right move, but from the perspective of the Pentium team this might be a horrible idea.
Much like countries and empires. Once growth largely stops being the easiest way to capture wealth "entrepreneurs" start eating away from the inside.
This is not a slam against people from wealthy nations. I am one of them. I just think it's a danger to be aware of.
https://pedestrianobservations.com/2020/11/13/surplus-extrac...
However the small companies almost always have VC investors, which brings negative effects which are approximately as awful (just in totally different ways).
If you can find a small self-funded company that isn't gonna get squashed next time Masayoshi Son sneezes, it'll be the best job you've ever had.
And what I view as completely irrational is the fact that in so many cases, the self-interested option is actually to work together and do something meaningful that advances you far more than chasing a quarterly metric.
It seems to me this would go the other way. Making a good product (in the sense that it's successful in the market) is what you want a company to do, but that's the thing mostly aligned with the profit incentive.
If profits are taxed heavily then spending resources on making a better product so that more people buy it doesn't make you a lot more money, but spending resources on office politics brings non-monetary personal benefits like status and control, so managers would have a greater relative incentive to do those things. See e.g. Soviet Union.
One of the biggest problems today is actually that the tax code provides incentives for corporations to retain profits within the organization rather than paying them out to shareholders to invest in something else, which results in inefficient corporate bloating.
Are you saying that low profit enterprises create more value? The thesis is attractive but also makes me wonder about Apple, high profit and also highly creative.
Ex-Intel engineer here that worked in R&D- I saw the exact same situations during my time and was one of the reasons I left. The way that teams in the same org with the same goals couldn't or wouldn't work together was incredibly frustrating and such a massive waste of effort. At the time I thought it was a unique situation with our group, but it's sad to see that it's more of a systemic issue that still hasn't been corrected.
People who are political as a prerequisite need to believe there is both a reward and a low fear of retaliation/termination for their actions.
Sometimes it makes sense to have a bit of competition, but having multiple prototypes (often with slightly different design parameters - e.g. a reliable design, an advanced design, and a moonshot) is a better competition than having managers attacking each other with passive-aggressive Powerpoint shows in a conference room.
In our case, making two teams work independently on the same problem just created a situation where each team had half as many resources.
Given Intel’s history of paying median rather than top wages and losing their best employees to competitors, they didn’t even have one full department capable of pulling this off, let alone 2 or 3.
These issues saw them going from 50% of the console market in 1993/4 to folding console operations less than a decade later.
SEGA is my favourite example of 'too big to fail' and turf wars.
Console Wars is a great book about this story.
When you’re small all that competitive energy is directed at your competitors. When you’re king of the hill that competitive energy turns inward.
So which team/location ended up winning?
Just one anecdotal story, one of the wafer guys had an idea to improve a process. He went to his boss who shot it down instantly. Wafer guy knew he was right so went to another manager who liked the idea and implemented it. It ended up working and being a great idea. Instead of being rewarded for his idea, wafer guy was fired by his manager for failing to follow the chain of command.
It's built into the culture at Intel to be territorial to advance. It's been that way for at least 30 years. I personally don't see it changing any time soon.
Intel has money and equipment and existing market share: there's no reason for them not to be profitable for the long term, as long as they stop acting like they don't have any competition (as they did until 2018) or that their only competition is AMD (as they currently are pretending).
Broadcom also tried and also failed. They came in cocky because they had succeeded in making Wifi chips with a 10-20 people team so thought that 500-ish people was more than enough for cellular even if Qualcomm had 4x that...
I would not be surprised if Intel fell into the same trap.
I'm not sure the engineers themselves having a big ego is a negative. I'd want a team who thinks they can do anything. But how you manage those guys is the problem...
I'm no longer surprised, but I'm still always amazed when this happens. It is really crazy how groups within organizations are often unable to see that collaboration is massively more in their interests than minor empire building. It's like they're trying to building a wooden fort a moat filled with mudaround it when they could be building Camelot.
(Well, Camelot minus the whole thing with Lancelot giving it to Guinevere, Arthur to his sister, and his estranged son coming back to kill him. Not quite that Camelot.)
I also seem to remember shopping around for a new phone a few years back and coming across android phones running on what seemed like a Frankenstein Atom processor. At the time I thought it was a promising concept, though benchmarks weren't flagship quality. But I'd hoped to eventually see dual-boot phones I could slot into a shell of a laptop to have access to a an ultraportable low-end windows box when needed. I'm kind of disappointed that never came about. (I know there's some promising "shells" for android phones, but I'd really like an OS I can fully control for my desktop experience, and Linux phones don't quite seem mature enough)
Anyway, any insight on the above from your unique perspective would be welcome.
Entrepreneurs typically rate low. They rely on goodwill and reciprocity and great relationships to get things done as they have zero power. Early power comes from getting people to buy into your vision.
Corporate middle / senior managers rate higher because it it generally all about the power.
The interesting insight was that as an entrepreneur, when your business scales it is hard to retain the “low Machiavelly” approach. This is where a lot of the growing pains come from..
Edit: add link https://www.harleytherapy.co.uk/counselling/machiavellianism...
Turf war and cookie leaking is a problem for all big companies, we are all humans, when there is no external threat, we turns to infighting. After all, why not? This will compensate the missing competing pressure that is also necessary as well.
But unable to have a cohesive strategy and call the shot would be Intel's own downfall. Looking back the past decade, they are on a one-way losing path, without any meaningful expansion. Had they have a decisive leadership, it will definitely fare better right now.
Since when is competition and choice a bad thing? If you're a chip design firm and you have a 8-month backlog to get your masks made at TSMC, what do you do then? TSMC can be world's best fab but we need to address the SPOF condition that is so close to the political hot zone in the APEC region.
Intel should spin off its Fab division as a separate company, hire some top executives to rejuvinate the workforce, make it the coolest Fab company in the world to work for and leap ahead. Intel TMG's Sohail was the biggest borderline criminal executive that was forced out a couple of years ago and was responsible for the 10nm delays.
It is enormously difficult for any startup to get into this space - you need billions and years of expertise to start a Fab. Or may be YC folks can? I worked in the Fab but don't have a birds-eye view of what it takes for a startup to get into this space. It would be amazing to see startups trying to manufacture semiconductors... you know live up to the Silicon Valley's name. You could have billions of dollars of economy built on services - US, EU and most advanced economies are shifting towards services; but they all rely on semiconductors. Imagine something were to happen to that... It is a juicy problem. We don't need Uber/AirBnb unicorns out of SV, we need Fairchild of the modern world from SV.
Edit: To see what kind of a beast EUV litho is, this is a good short documentary on it: https://www.youtube.com/watch?v=f0gMdGrVteI
They have fresh new chip designs that would be perfectly adequate, but they are still hobbled by 14nm. They have now released three? four? iterations of x86 design on the same 14 nm process, because 10nm is that troubled
If you spun off the fabrication, as AMD did, you would have a much smaller, but more-competitive fabless business, and the fabricator would implode. (Which is pretty much what happened to Global Foundries, AMD's former fabrication house)
In any case, much of the value for shareholders would be eradicated. Intel has historically done very well as a vertically integrated business. They would like to remain vertically integrated.
We may see Intel resort to outside fabrication -- executives have already mentioned it in the business press -- but I very much doubt we will see them discard their internal fabrication capabilities.
I don't know where the notion of "Intel is about to die and TMSC will make us suffer due to monopoly" comes from but before having people cheer for Intel again they probably need some time to have their execs cure some disease in some poor part of the world, do a few AMAs on reddit, open-source something, donate to some cool projects in tandem with actually improving their products before regaining the goodwill of the people. Can take some clues from Bill gates and Microsoft.
The consumers are pissed. AMD's comeback is attracting a lot of fanfare because of people being sick of the not having an option beside "should I get i3, i5 or i7" for very long time.
The fears have less to do with TSMC the company and more the fact it's a pawn in the geopolitical chess game between the US (and her pacific allies) and China.
The issues with supply chains through Taiwan have little to do with whether gamers are buying their CPUs from AMD or Intel, but the fact that a critical piece of infrastructure in the Western economy is very precariously located, and in the event of war or political strife is not going to be able to be mobilized for domestic (or even friendly-allied) production.
Intel is stumbling, but up until very recently they were still the fastest gaming CPUs available. That didn’t stop gamers from criticizing them endlessly and cheering their demise. Intel went from cool to uncool.
Give it a few years and they might be able to leverage the underdog position into a comeback story.
Semiconductor R&D costs have been going up, companies consolidating or went into niches. There are jokes about having to buy from The Semiconductor Company® in the future.
Intel is sitting on a lot of money, so they're not going to die soon. But they haven't been showing signs of improving the situation since 14nm was delayed in 2013. This saga didn't start with 10nm. Remember that the cadence used to be tick-tock every 18 months. We still can't get 10nm desktop chips. So there are some questions how they'll fare in the future.
Who is saying this? There is competition, and Intel is starting to lose.
> If you're a chip design firm and you have a 8-month backlog to get your masks made at TSMC, what do you do then?
Wait 8 months. This is a lot better than getting a "Lol, we don't do custom masks" from Intel.
> Intel should spin off its Fab division as a separate company, hire some top executives to rejuvinate the workforce, make it the coolest Fab company in the world to work for and leap ahead.
Yes, they absolutely should do that. The only question is if they have the guts to do it.
Is it years of work to figure out the placement of CPU/GPU/memory units on the die, routings, and come up with new instruction sets? I imagine this wasn't new physics, Apple was just using contract fabs, right?
What's the secret sauce that let them pull this off, and fend off others?
Edit, oh, this is somewhat answered below in https://news.ycombinator.com/item?id=25093313
What really defines Apple’s Firestorm CPU core from other designs in the industry is just the sheer width of the microarchitecture.
Much of the opcode space is wasted with old single byte instructions that are rarely used these days. There are REX prefix bytes required everywhere to access all 16 registers. Modern instructions that are used all the time are hidden away behind prefix bytes.
64bit ARM is a complete redesign of the ARM instruction encoding, and they put a lot of thought into using the instruction space optimally. 32bit ARM also wasted a lot of it's instruction encoding space, but 64bit ARM is a massive improvement. Despite requiring roughly 10% extra instructions on average, the average arm64 is around the same size as the average x86 binary.
Immediates aren't a huge problem. All 32bit immediates and many 64bit immediates can be encoded in 1-2 instructions. Anything that can't should probably just use a PC relative load.
IMO, the much simpler instruction decoding massively outweighs the need for slightly more load bandwidth.
r1 = r2 * r3
r2 = r3 * r4
r3 = r4 * r5
r4 = r5 * r6
But if you rewrite the names of the registers (variables) and use a larger set of registers (variables) then you can express the same semantics without overwriting any registers. If you do so you can run the operations in parallel on different execution units within the same core.
The ability to run multiple functions at the same time is called "multiple (or wide) issue".
There are different kinds of functional units inside a cpu. For example, some can do basic arithmetic but not divide. At any given time, some functional units will be busy or free. The amount of effective parallelism present in the input stream you can effectively use is bound on whether you can successfully map your instructions into functional units that are free at that time.
Often, you while cannot run a given instruction because for example the multiplier unit is busy, the next instruction could be run because it depends on the divider functional unit, which at that time is free.
The ability to execute instructions out of order is called, well, "out of order execution". It depends on the ability to rename registers and keep track of actual data dependencies. The cpu needs some memory to keep track of that data.
It's unrelated pipelining (which I could give a try explaining too if anybody cares to hear a similar explanation)
It is about lack of control over legacy killing the progress. The power of Intel is "proven" legacy, but building completely new architecture is expensive and prone to adoption failure (Itanium?) when Intel has no control over OS (Windows), apps or virtualization software.
Then Apple has control over all that: they can make hardware (scaled up mobile HW), change their OS to support it (iOS bits), support past apps (Rosetta), enforce support in new apps (compiler, LLVM, certification).
It wouldn’t have mattered if Intel controlled the OS or not - it just wasn’t competitive. There’s nothing you can learn from it about Apple - who delivered an ultra competitive, likely even when emulating Intel architecture in software.
Arm has swapped a large part of its application user base from 32 bit to a completely incompatible but more modern 64 bit ISA and Apple has cast off the 32bit legacy completely due to its ability to control the whole stack.
Intel could easily open up their boot and make the store there much better.
The don't quite have the vertical control of Apple, but to say they are fundamentally hindered by their legacy is quite questionable.
The fucked up improving their manufacturing.
Once devs will sort out their new shiny ARM Macs whoes (Docker, other tooling) I smell there may be ARM server market rising soon.
[1] https://help.ubuntu.com/lts/installation-guide/armhf/ch02s01...
Intel had Tigerlake / WillowCove Design but they cant ship it. They also have Golden Cove. If you have put the design they were suppose to be using now, on a IPC basis Intel might still be in the lead.
Is it the work to figure out how to lay down the component blocks on the die and all the circuit routing? Is it figuring out how to assemble the power-efficient components from the Arm library? Does that take years? Is it the instruction set? Is it the planning for manufacturing capacity?
I'm just curious to know what the actual work and division of labor / time is to "make a chip".
I would love to know for example:
-- Initial design, 10 people, 1 year
-- Prototype runs, 5 people, 6 months
-- Final design, 5 people, 1 year
-- etc etc.
-- Acquiring fab capacity / manufacturing hardware, 10 people, 1 year
-- etc etc.
But sounds like there's no way Intel or others can just "leapfrog" even if they knew what needed to be done and could abandon their prior choices.
At best It take one year to build a Fab. It takes another one just to plan to built it. That is assuming you get the regulation approval with zero delay.
Building a Fab means absolutely nothing if you cant get the process to yield. Look at Samsung Foundry in the past 3- 5 years.
Intel's Leapfrog chances was their Intel Custom Foundry. Had they not mess that one up they would have a Fighting chance. Even if they had a Design that Leapfrog Apple's M1 today, it would still be let down by their 10nm SuperFin Process.
No one makes ARM chips for laptop, because of the chicken and egg issue. Windows on ARM going mainline could change it.
If you read the anandtech article describing the A14/M1 chips, it seems that the ARM ISA lets Apple do some things that are either exceptionally hard or impossible on x86, like making individual cores much “wider” in terms of instruction decode, allowing the A14/M1 cores to do significant parallel execution. This allows their cores to be significantly more efficient in terms of instructions per clock cycle. To be clear this isn’t just the benefits of ARM - Apple is far ahead of other ARM designers as well. On the other hand, the wider the execution pipeline, generally the slower the cores have to be clocked (Im actually not sure why this is, to be honest). This is part of how Intel is able to produce chips in the 5.0+ GHz range.
So it’s not that every designer converges to the same design (internally, they’re quite different). Instead, what’s happening is that all the relevant trade offs (pipeline width and depth, ISA, fab tech, power targets, etc) are leaving competitors within an order of magnitude in performance. And the question of who’s going to take the lead is a question of who’s executing best on all these fronts, and who’s currently got a lot of talent working on areas that will see continued improvement.
But whatever happens, I wouldn’t bet against Apple. Their team has been delivering improvements like clockwork, year over year for quite a long time now.
I'm not a tech journalist, but the way they seem to have done this was exactly what was described in this essay. AMD brought out "chiplet" designs, initially at the low end, but with significant performance gains generation over generation. Combined with simpler motherboard slot conventions, delay's in Intel's next-generation processes, and overperforming Intel in areas like streaming, the value case for buying AMD processors in this space has grown to the point where you would find very few enthusiasts who would strongly recommend Intel over AMD if you're building a new system and wanted the best performance at your price point.
Seems the infighting issues described by another poster have not only affected Intel's competitiveness in the mobile space.
I just checked my go-to hardware recommendation site, Logical Increments[0], and not a single Intel CPU makes the list. AMD everything.
I'm on the 3900XT, one of the last from the Zen2 line - it's a ripper, yet I can also just drop in a 5900X or 5950X without having to change the motherboard.
Notwithstanding the many Intel security issues where the remedies nerfed performance, between Apple and AMD, I can certainly see Intel in a bit of struggle.
And they've has offered the 10600k with a $20 rebate on motherboards for months now...
$50 should come straight the case which is totally overshooting for a budget PC (I recommend the 300L here)
That leaves you with a 10 dollar difference for an CPU that competes with the i9 in gaming...
-
And by the way, even the next build up chooses a 3600X over the 10600K despite the former even beating the 3700X in gaming benchmarks.
The 10600K is an insane value for gaming, and still fast enough for non-gaming tasks. Seeing as they're listing "heavy gaming" as a measurement on these builds it doesn't make any sense for at the very least the i5 to make an appearance.
There's no sense in intel right now when doing a new build.
Giant asterisk during a global pandemic no?
And that's paying $50 more than what is apparently already too much for almost equivalent gaming performance (slightly better after overclocking and the motherboard and cooler priced in above support that too)
Ryzen came in the door at #2 in a market that goes well beyond #10.
The motherboard conventions aren't simpler, just longer supported.
AMD is doing impressive work with Ryzen, don't get me wrong, but they've already been #1 in x86 performance before, in the mid-aughts. Before and after that, their flagships were #2 in x86.
I worked for Intel then... The problem was AMD couldn't compete on volume. An individual could go buy an AMD chip at a great price, but AMD couldn't fill a large order from a PC manufacturer. Furthermore, we suspected their margins were too slim to keep investing in themselves.
Remember that DIY pc building is a niche. Something that makes perfect sense when you're building a single PC may not make sense when you're making thousands of laptops.
They should have been suffocating their R&D with cash, but has that happened? Instead Intel is the world leader in buying companies, dissolving them and EOLing their products. I think on more than one occasion, they bought a customer hardware company and refunded every buyer of whatever gadget that company made.
[0] "Proportionately, employees in their 50s were three times more likely to lose their jobs than workers in their 30s, according to a document obtained by The Oregonian/OregonLive that tallies every Intel employee in the United States."
[0] https://www.oregonlive.com/silicon-forest/2015/08/intel_layo...
* Broken 10nm and 7nm fab process. No end in sight. Even IBM could surpass them.
* Even with much stricter memory guarantee orderings they managed to break caching and C3 kernel/ user seperation security (Spectre, Meltdown, ...).
* Temperature management. Eg AVX512!
* The government "mandated" backdoors.
Who would have expected such massive Boeing-like fuckups from the industry leader?
"But if you don't expand into other markets, you'll eventually die!" Sure, but that's not a bad thing. The purpose of a corporation isn't to continue existing in perpetuity, but rather, to maximize returns for its investors. You found a gold mine? Great, go mine it until it runs dry, then close up shop and call it a day. There's no need to spend half your profits on a wild-goose chase for other gold mines (blackberry investing in self-driving cars anyone?) - if that's what I as an investor want, I can just use my dividends to invest in other companies or startups that are aiming to do exactly that.
I'd rather invest in a company that sticks to the things that it can reliably excel at, and direct its profits back to me, so that I can then invest it in other companies that I trust in other fields. A company that is spending half its profits trying to be something it's not - that's my worst nightmare as an investor.
Society grants a group of people immunity from personal liability when they form an organization that has some chance of carrying out some useful work. The organization becomes a special kind of entity - a corporation. It can operate without its investors & officers fearing that their own wealth is on the line should something go wrong. Societies do this because it is widely believed that it would be impossible for various things to happen without it. That is, if personal liability was always in play, nobody would organize human organizations to try to accomplish difficult/dangerous tasks, and the same might also apply to unlikely-to-succeed-but-potentially-significant efforts.
That's what the purpose of a corporation is, not maximising returns for its investors, which is a recent idea (dating back to the 1970s) and has nothing to do with why corporations exist.
Maybe it actually is in the interests of <some-group> that Intel runs off on tangents. How would we establish that? Well, we'd have to have some understanding of what the purpose of the corporation is. I don't claim to have any special insight into that, I'm just pointing out that claiming that its purpose is maximising shareholder revenue is historically revisionist and inaccurate.
It is not society's business to allow or disallow different kinds of contracts between private parties. If I know that corporation's investors don't have personal liability and still decide to go into business with them, it's my personal decision to accept this risk and not society's. If I so please, I could go into even riskier deals, up to just gifting them my money. It could be a stupid decision, but it's my decision to make, not something that "society" can allow me to do – actually, not society, but it's worst enemy, the government.
Of course, some governments act out of assumptions that you stated, but it's nothing more than just justification for tiranny.
They don't exist and were not created to sell potentially risky products to eager consumers. They were created to engage in capital-requiring efforts (notably expeditions, but also large scale resource extraction and industrial projects) that would not happen without the personal liability release.
They would not happen because the potential for liability related to the endeavor was clear to all (i.e. people would likely die, and vast amounts of money might be lost).
But societies (and notably royal families) wanted those things to happen, and so they create corporate charters to encourage them to do so.
We could make do without corporate charters, but then we'd also likely be making do without most of things they enabled, because essentially nobody would have had the guts to bet their own personal liability on what were clearly risky and dangerous endeavors.
That's a common misunderstanding.
"In nearly all legal jurisdictions, disinterested and informed directors have the discretion to act in what they believe to be the interest of the business corporate entity, even if this differs from maximizing profits for present shareholders. Usually maximizing shareholder value is not a legal obligation, but the product of the pressure that activist shareholders, stock-based compensation schemes and financial markets impose on corporate directors." [1]
[1] https://www.lawschool.cornell.edu/academics/clarke_business_...
The risk is that a competitor comes out of these adjacent markets and edges you out. That's what's looking likely to happen with ARM, which is slowly moving from embedded / cellphone to laptops and servers.
Films, albums, festivals, etc.
Nokia’s leadership was also big fans of this book in 2000-2010. They saw themselves as the nimble disrupters, eventually eating away all computing markets with their cheap plastic phones and a smartphone OS derived from embedded systems. If Nokia would just keep adding features, the Christensen theory promised that they’ll one day own the upscale markets too, like in all those case studies in the book.
Instead Nokia’s business was destroyed by actual innovation: Apple combined a new kind of mobile UI with an OS derived from high-end PCs. It didn’t fit on the ladders of innovation shown in the book. It wasn’t a cheaper thing becoming good enough, but an expensive thing that was nearly impossible to manufacture initially. And that’s why Nokia thought they could safely ignore it, until it was too late.
Intel used to have a manufacturing advantage which they longer do. That is where they are trailing: Material science and manufacturing. This stuff cost a lot of money and requires and lot of Research. This is the Kind of stuff MBA types don't necessarily want to invest in.
Here, of course, Apple is unlikely to sell its chips to other manufacturers... so any disruption will be at the product level: affecting wintel laptops, desktops... and eventually perhaps game consoles and linux servers. Everything.
BTW I really enjoy his theories, but let us note that Christensen himself assessed the iphone as non-disruptive.
Which I suppose it is, but I think it's important to ask: if Apple didn't introduce a disruptive technology, why were they able to do what Nokia didn't?
Its hard to deny how the iPhone represented a power shift away from carriers. It's easy to forget but a decade ago you had to pay carriers for the privilege of changing your ringtone. They had their fingers in every pie, in exchange for access to the market the carriers more or less controlled. Hell, you often couldn't even bring your phone if you switched carriers.
Nokia was too busy pleasing their customers: the big cellular providers who ordered most of their phones. And the status quo heavily favored them -- the top selling phone of all time is still a Nokia phone from 2004. They didn't really have any idea how to market direct to consumer and their brand had no particular meaning -- they made as many SKUs as carriers wanted. Since they were in a clearly dominant position, they had no need to arm twist the weakest player to break into the market, and a lot to lose if they played hardball.
Clay's right that it's not a traditional "cheap tech finds a new purpose undermining more expensive status quo" but it definitely rhymes -- all the incentives are the same and adequately explains why Nokia fell apart.
Indeed the iPhone can be seen as opening a completely new market, instead of disrupting an existing technology. Laptops still exist, desktops still exist, servers still exist. iPhone expanded the technologies available, did not replace any existing one.
How do you gather? I think it'd make sense for Apple to earn more money by acquiring Intel's customers.
Secondly, why have part of the pie when you can have the whole pie? i.e. instead of just acquiring Intel's customers, also acquire their customers, all the way to the end-consumer, gobbling up the margins at each step of the way.
Afaik, all of Nvidia, Apple and Qualcomm (dunno about AMD) pay significantly higher wages than Intel.
If Intel is starting off on the back foot and cannot get top talent, then their decline is all but guaranteed.
It was a stark contrast from nearly every other fast-growing tech company in the area.
I visited Intel HQ once, and it really did look like that. Is it still like that?
There is also a cultural difference between hardware engineers, who are usually more 'serious engineers' who actually engineer things vs software engineers who are often less rigorous in their architecture and design. HW folks deal with long lead times and can't usually fix errors after production, so that creates a vastly different culture.
That’s not entirely true, at least in Hillsboro (I interned there recently). Drinks were free, and so was fruit, but you had to pay for e.g. donuts or chips.
I don't need snacks and drinks at work, just water and the occasional coffe, which I get at the bar anyway so I can have a little walk and clear up my mind
Workplaces that looks like a teenage dream party give me the chill
When I need to relax I stop working entirely and go out
I consider more money or more free time (or both) an incentive
I appreciate solid forniture, a comfortable seat, big windows with natural light, a nice neighborhood (last work I accepted was because they had an office in Duomo in Milan, the one I have now has an office 5 minutes away from the Colosseum in Rome), I don't care much about "free stuff"
Paying for my drinks or snacks it's not what will bankrupt me
Intel needs to reach 10nm and 7nm, and they needed to do that 5 years ago.
On the other hand Intel is a huge national security interest for the US, so expect the government to help them out where possible.
Second, perhaps the AMD/Apple fan boys have not noticed but Intel has many times the volume of AMD and whatever ARM volume Apple will have (Apple is typically 10% of lap/desktop sales, up this year from Covid). The world requires Intel to meet its computing needs and no magic wand will give the other guys that capacity anytime soon.
It is way to early to count Intel out.
A lot of the top-talent has left Intel and I think that will continue. Unfortunately for Intel most of the mediocre employees have stayed.
Second, if you are a PhD in this area (a hybrid of Computer Engineering and Computer Science, and I believe that a PhD in this area is the minimum qualification for this type of work) then you do not have a large pool of employers to choose from in the first place, so any employer that's competing for folks from this group will likely end up with a decent number of talented people anyway.
Graph conveniently omits AMD who now beat Intel using the same ISA but different process.
M1 apparently has much lower power consumption.
So something else is going on other than “Apple is willing to spend more to make cores wider”.
Apparently ARM supports 4KB, 64KB and 1MB (I just googled that)
Also maybe all the x86 crud might be finally taking its toll (and not just the ISA but all the cruft that got on top of it for 40yrs+ like legacy buses and functionalities, ACPI, or even the overengineered mess that's UEFI)
They are able to shovel transistors at the core because there are only 4 of them. AMD on the other hand is packing 64 cores into a package, so each core has to make do with less.
So they are working on a smaller process node than their competitors, and they used their market position to ensure that they will be the only ones using it for a little while. That gives them a significant leg up.
Skylake was the "tick", then they couldn't "Tock" to 10nm, so they made 14nm+, then 14nm++, then 14nm+++... Intel's been stuck on the same process for half a decade now.
That could not have come at a worse time for a company like intel.
[1] https://www.reuters.com/article/us-intel-ceo-idUSKBN1JH1VW
Even worse - the same architecture as well, which is why they have to backport their 10nm Ice Lake architecture to 14nm to even get anywhere.
Another part of it is just that designing a CPU with good single threaded performance is hard and costs a lot of die area and no one else in the ARM world was incentivized to do this - who needs a smartphone with that kind of performance (I know, I know - all of us, now)? But Apple also makes IPads which are kind of a bridge device - mobile and battery-powered, but also big and something people might want to do real work on.
I’m also going to say that I think Apple is still alone among the phone manufacturers in recognizing that smartphones are software platforms, not simply hardware devices. I think they have a special appreciation for the enabling power of a more capable CPU.
The 5 Watt iPhone CPU almost beats the 45 Watt AMD CPU. And the M1 will then simply obliterate the x86 incumbents.
Why? The real reason is that Apple had/has the real advantage. It's size, resources, money, strategy, know-how.
It's bigger than Intel. It has a better corporate culture than Intel, it has a vertically integrated market completely safe from any outside disruption for years, and will be for years. It had the opportunity to do this switch, so it had the motivation to develop this capability.
Apple was able to hire the best semi designers plus benefit from the ARM platform.
AMD is still too small and relatively spread thin - trying to cover multiple segments of the general market - compared to Apple, which basically has this one chip in two versions (mobile and ultra mobile).
Of those two advantages, the process one is a lot more significant. Their chip loses in single-threaded performance to AMD's newest, which are still one node behind Apple, but appears to be more power-efficient. I fully expect that once AMD gets on the matching node they will take the crown back, even in a laptop power envelope.
Everyone else with the immediate capability are professional ball-droppers.
Motivation to do so.
Intel had none.
That leaves AMD. AMD Isn't eating Intel's lunch, they've had a pretty good taste of it and are about to say "no, not just lunch, we're taking all the food".
But there's a window. My not-very-expert opinion is that the window is 2 years. That's how long Intel has, while AMD chips away its market share with new installed systems, to turn things around. If they do it, they'll still have to claw back their previous position, or there will simply be a new stable equilibrium, but I think Intel's dominance in the server & consumer-grade space gives them some breathing room.
In the consumer space, shoppers for high end systems e.g., gaming etc are gone: AMD has them now, and more every day. They have me, that's for sure. But the much much larger consumer market is not in gaming. Intel has the name recognition for the average consumer, and it's their hardware in most consumer grade systems. A quick glance at a dozen consumer grade laptops & desktops from HP & Dell don't show any AMD CPUs in them.
So, Intel still has that level of inertia. If they can limit the bleeding in server & high end systems to a rapid bleed-out instead of a near instant & complete gushing torrent, that inertia may be enough to allow them to claw things back if they're able to execute within the next two years.
I'm no Intel fanboi: They lost me unless/until they turn things around. And from where they are now, I don't rate their chance more than 50/50, which might be generous. But I do think they've still got 2 years until their viability is really threatened. At that point, and I'm sure they've got some skunkworks & low-profile conversations going on about this already, they'll need to look at offloading high performance fabs to TSMC.
Personally, from a global strategy standpoint, I think the US might not want to lose what is really a strategic asset that way though, so we could also see some type of subsidy/bailout/whatever to prop them up.
Even more generally, in business there are few hard and fast rules and even the ones that work lose their efficacy as the participants learn and adjust to them. Which is a good thing for the system as a whole. I would speculate that entrepreneurs should now look beyond disruption.
(1). http://www.newyorker.com/magazine/2014/06/23/the-disruption-...
Zerocool: Yeah, RISC is good.
Intel’s real disruptive strategy was the Pentium Pro architecture that disrupted the mainframe market, proven by ASCII Red in 1995. But you don’t hear about that because the business leaders didn’t even know it existed (same with multi core btw). The problem with this, as with all disruption, was low margins, so IA-64 was an attempt to enter the mainframe market as a peer of the high-margin encumbents, and was itself disrupted by the broadly inferior but cheaper AMD64. Low-margin ARM disruption also should have been expected as normal and unavoidable.
The big question is what market Intel can disrupt next. I have criticisms I’ve held back on, but one thing I will say is that Intel’s portolio of disruptive technology is greater than I had expected. Leadership has to be able to put together the pieces. NVidia, for example, probably has less core technology, but their direction is more aligned.
I made a similar bet on SUN about 17 years ago and a smaller one on RIM (Blackberry). I'm getting a deja vu.
This all started when I bought a bunch of Apple stock around $2 and for the past 20 years I've been trying to make that play again. I guess I'll have to admit this position in GE is similarly worthless.
I gotta stop making these gambles of faith, Intel has ceded nearly everything and is defending their remaining kingdom poorly. Unless there's a major overhaul, things aren't looking good.
They've also been bleeding talent for years. I need to stop second guessing what I find obvious. Nvidia, Arm and AMD have already stormed the castle and have been pillaging the kingdom for years now. Once you see companies like TI and Marvell start to take significant pieces away then you'll know they're done for it.
- The availability of third party IP (Arm CPUs and originally Imagination GPUs) and manufacturing (Samsung and TSMC) that have allowed Apple to pick and mix to build its own SoCs.
- The fact that Arm has clearly been much more focused on power efficiency which might mean it has IP which Intel can't access (speculating here but we have big.LITTLE).
- Possibly the most importantly, the the benefits that Apple gets from being able own the whole stack and design SoCs that precisely match its needs.
As a result I'm a bit sceptical about whether Intel would have got Apple's mobile business long term given that market's eventual structure: the advantages of Apple's current approach are just too great.
October 2007, CFO Andy Bryant Promoted to Operations Chief.
September 2009, CTO Pat Gelsinger left Intel.
2010, CEO Paul Otellini started work on Intel Custom Foundry.
July 2011, Andy Bryant was appointed Vice Chairman on Intel's board.
May 2012, Andy Bryant became Chairman of the Board.
May 2013, The Board appointed Brian Krzanich as new CEO.
And the more recent event you should all be fairly familiar.
Other than that, If I could sum up Intel's problem in one word, it would be Inertia.
> "We ended up not winning it or passing on it, depending on how you want to view it. And the world would have been a lot different if we'd done it"
No, it wouldn't. Maybe the iPhone would have been delayed 1-2 years. But they surely didn't have the capability to make this CPU properly, as all of their attempts in this field in the coming years demonstrated.
But AMD is dominating them now on one front, and now a major customer of theirs makes their own chips which on the surface seem to be better.
Apple’s Xserves were awesome. Not cheap. Only marginally competitive. But a joy to work with because of all the nice little details like a FireWire port on the front so you could boot it off of an iPod.
Not to mention buying their own hardware will obviously save them.
[1] https://twitter.com/ajassy/status/1318930486517927937?s=20
Apple's current ARM offerings are strictly locked to their own hardware, and there's been no hints that they may move into the ARM-PC space selling general purpose chips and letting other vendors produce board. I'd expect to see that first before an Apple silicon powered server.
Seriously - it was a resounding failure, even with Intel spending big bucks to convince this class of customers it was the future. There was little uptake and vast dissatisfaction with achieved results. IMHO I expect Xe to follow the same (very shallow) trajectory in HPC as in gamer graphics.
There is one remaining large machine (DUG "Bubba") using Xeon Phi and that's only an artifact of software tolerance combined with a _really_ great deal received on Intel's remaining "Knights Whatever" parts inventory.
...and yet, was it any better than a midrange GPU in compute?
Intel is the new IBM. IBM at the end of the 80’s was filled with smart people innovating piecemeal technologies that couldn’t be brought together to create compelling products. And the products that they were selling were expensive and technologically moribund.
Now since that is not an issue anymore, you see Intel getting beaten everywhere. And that is only because Intel's actual competitors in Taiwan and Korea are have now surpassed Intel.
In case anybody was wondering why Otellini was wearing a cleanroom suit on stage, it was a reference to Apple's 1998 "Toasted Bunny" commercial for the Power Macintosh G3: https://www.youtube.com/watch?v=e6PoLiXCA40
…which was itself a reference to the Pentium Ⅱ commercials of the time: https://www.youtube.com/watch?v=qvt65mHXmR4
It's easy to be wise after the fact, but we can now say that Grove or Otellini didn't take a big enough risk. Instead of risking cannibalisation of their core markets, they might have won a bigger prize over the longer term by straying further.
Desperate Gamers Camp Out in the Pandemic for $700 GPUs Months after the Nvidia GeForce RTX 3080's launch, the lines at brick-and-mortar stores across the country can still wrap around the block.
https://www.wired.com/story/nvidia-amd-demand-pandemic-lines...
C'est la vie.
Apple designs chips and devices in lockstep. When designers were working on various A-series chips, they knew the details of the device, and could optimise on that.
Qualcomm doesn't get that kind of view. They make a generic CPU design for given market segment, and have to "please" much wider buyer range. As such, if they tried to apply some of the things that are publicly known about Apple designs, they would probably end up with a chip that would be hard to sell due to taking more space or having higher TDP etc. And before advent of multicore, Qualcomm was using the available space budget heavily to integrate the radio functionality internally (then it oscillated a bit over time depending on chip and market segment).
https://www.anandtech.com/show/15846/jim-keller-resigns-from...
Wow, they don't even know exactly how disrupted they are...
Does anyone know of a collection of other similar crossing plots on this topic? Would be really cool to study those...
If magically Intel 7nm gives awesome yield next year, will they be able to catch up with a bigger caches and Big.small arch. Will they need lot more help from Windows / Linux to achieve performance gain in lockstep like Apple does by controlling both OS and processor?
This disruption, that disruption... what is of it?
The word is progressively loosing any meaning.
https://www.goodreads.com/book/show/2615.The_Innovator_s_Dil...
In the article, the chart from Christensen's early work about disruptive innovation, and the chart of Apple chips overtaking Intel chips in performance, do seem to have a striking resemblance.