Intel sees opportunity in downturn

Intel's Gordon Graylish believes firms should invest their way out of the downturn

Intel spelled out an upbeat assessment for IT in the current economic climate this week, and said the downturn should be seen as an opportunity for firms to change the way they currently operate and prepare for the recovery. The company also said it expects Moore's Law to continue to apply for at least the next decade.

Speaking at a briefing for press and analysts, Intel's EMEA vice president Gordon Graylish acknowledged the difficult time everyone is experiencing, but expressed his opinion that the three previous recessions were worse for the IT industry than the current situation.

"The IT industry is not immune, but it's not all negative, either. We're seeing willingness to take a different approach from customers," he said.

What businesses need to do to ride out the recession is to attack non-essential spending, but proceed with investments that will make them more competitive.

Perhaps unsurprisingly, Graylish put the case for businesses to continue investment in new IT hardware. He argued that the latest Intel-based systems could deliver huge savings through energy efficiency and improved management, even when compared to those from just three years ago.

A server room kitted out with 184 single-core Xeon servers in 2005 could be replaced with the same number of Nehalem-based systems to deliver nine times the performance while cutting energy consumption by 18 per cent, Graylish claimed. Alternatively, the same workload could be handled by just 21 Nehalem systems, he said, leading to a 92 per cent reduction in energy consumption, meaning the upgrade would pay for itself in as little as eight months.

Intel claimed similar gains can be made on client systems by switching to newer desktops and laptops that support Intel's vPro management capabilities.

Graylish also said that while Europe has lost jobs to developing areas like the Asia-Pacific region, this has been in engineering and manufacturing while much of the actual design work behind products has remained here.

"We need to invest to ensure that upcoming generations have the necessary skills to prevent outsourcing of this role as well," he said.

"We also know recessions represent opportunity. It's when we think about doing things differently. If all is going well, then we will keep going with the same strategy.

"IT companies are now challenging the sacred cows of the last 30 years. We can’t afford to deploy a server for every application; we need to use virtualisation to make the most efficient use of resources instead."

Intel itself is continuing to invest, and intends to put $7bn into bringing its next-generation 32nm chips to market during 2009 and 2010, according to Graylish.

"Real breakthroughs don’t often come from big companies," he said, so while Intel does a lot to incubate good ideas internally, the firm also works closely with universities, and start-ups.