Intel has made a further internal reorganisation but saw its shares fall on Friday as analysts warned of a chip glut ahead.
Meanwhile, Intel's president Craig Barrett admitted that the reorganisation reflected the company's desire to diversify for growth. Intel has made several changes to its management structure in the course of 1998.
A statement said that Intel's executive vice president Frank Gill would retire from the company on 1 June. He headed up Intel's increasingly important small business and networking unit which is now to be split into several different units.
The networks product division will become a separate business unit, reporting direct to Intel's board. The reseller products group, part of Gill's portfolio, will become part of Paul Otellini's architecture business group, and the reseller operation, also part of Gill's empire, will report to Sean Maloney's sales and marketing group.
Craig Barrett, president of Intel, said: "Frank [Gill] felt the strong desire to spend more quality time with his family. He will be missed by all his friends and colleagues at Intel."
The statement pointed to Gill's achievements in expanding Intel's business activities in Japan and Asia, leading the company's efforts in the motherboard business and "driving the company's push into a full range of networking products".
Barrett said: "It has become increasingly clear that we must continue to focus on our core Intel architecture, and diversify into new businesses if we are to re-energise Intel's growth in the future."
The new business group was intended to "nurture and grow new business opportunities" and be flexible enough to serve those businesses.
Intel's new business group will be headed by Gerhard Parker, an executive VP. He will look at growing the company's market opportunities while the group will subsume Intel's digital imaging and video division, Internet services operation, business communication products, systems management and home networking operations.
It will also include under its mantle the architecture labs and a content group, as well as running a joint venture between Intel and German software firm SAP.
Meanwhile, Intel's shares fell by five per cent last Friday as Merrill Lynch said a chip glut was in the offing, according to the 'Wall Street Journal'. The reasons for that was because the PC market was growing slower than expected, while AMD and Natsemi-Cyrix were increasing both their production and share of the entry level market.
Last week, National Semiconductor issued a profits warning and said that demand from PC vendors for their products had still not picked up. If that applies to Natsemi, then Intel is experiencing similar problems.
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