Paul Otellini has accomplished much at the chip maker. But as he prepares to step down, those gains are offset by the absence of a credible product in the mobile device market.

By MSN Money Partner Jan 19, 2013 12:58PM

Intel CEO Paul Otellini in September 2011 (© Paul Sakuma/AP Photo)By Ashlee Vance, Bloomberg Businessweek 


Bloomberg Businessweek on MSN Money

On Jan. 17, Intel (INTC) delivered a batch of fourth-quarter financial results that were to be expected. Its sales fell to $13.5 billion, from $13.9 billion, as -- guess what? -- people bought fewer PCs than during the same period last year.


Take 2012 as a whole and Intel posted revenue of $53.3 billion, down from $54 billion.


The big takeaway is that Intel produces one hell of a whimper. The chip maker's sales have fallen, as have its net income and margins. But the company still sells an incredible amount of silicon, and chalked up $18.9 billion in cash from operations last year. Many companies would kill to have Intel’s problems.


It now looks as if Chief Executive Officer Paul Otellini’s career will end as the company continues on its current trajectory. Intel has forecast that sales in the current quarter will likely come in below expectations -- a sour note before he retires, as previously announced, in May.


The singular failure

Otellini was tapped as CEO in 2005 and has survived years of great tumult. He battled antitrust regulators in Europe and the United States  over issues pertaining to rival Advanced Micro Devices (AMD). He managed to fix Intel’s server chip business after it had fallen behind AMD’s -- a move that has left AMD near collapse and Intel making huge profits in the data center. And he turned Intel into a true software powerhouse through a series of acquisitions and high-profile hires.


(He also bought McAfee for $7.6 billion, a deal that someone, someday may be able to explain.)


What Otellini did not do was deliver a credible product in the mobile device market in anything resembling a timely fashion. The singular failure has undermined most of the company’s successes during his tenure as chief executive.

This is why his dramatic wins feel so neutered.


Intel is due to name Otellini’s successor any day now. The next CEO will at least have a fighting chance to play off some of the company’s investments and come out looking clever and exceptional.


The low-power chips now arriving from Intel appear competitive with the ARM-based designs from Qualcomm (QCOM), Nvidia (NVDA) and others, meaning that Intel is finally in the running for smartphone and tablet wins.

Intel has also started flirting with the idea of becoming a contracting chip maker able to compete with Taiwan Semiconductor Manufacturing (TSM), Samsung and Global Foundries.


It puzzles me that Otellini decided to step down before seeing these bets through to their conclusions. His legacy, as it stands, will end up closer to ho-hum than spectacular.


More from Bloomberg Businessweek

 

The partnership has received scant attention, given its potential to connect the digital world with the real world in trail-blazing ways.

By TheStreet Staff Jan 17, 2013 4:54PM

mobile paymentsBy Dana Blackenhorn, TheStreet

Since summer, when Starbucks (SBUX) announced its partnership with mobile-payment start-up Square and began rolling out Square's digital wallet application to 7,000 coffee shops, the story has gone as cold as hour-old coffee.

TheStreet logo


But if you're into investing in such areas as transaction processing, big data or even social marketing, it's time to take notice. Because this hits all of those buttons.

 

The transaction-processing button is easy to describe. Until now this has been a cozy relationship among merchant processors, their resellers and banks. Merchants signed agreements with resellers, approved by their banks, and the resellers delivered software and terminals while the processors handled the back end.

 

Betting that there's still of plenty of life in discs, Redbox Instant will offer DVD rentals along with online access to movies.

By MSN Money Partner Jan 17, 2013 2:53PM

A rental DVD is dispensed from a Redbox © Damian Dovarganes/AP PhotoBrad Stone, Bloomberg Businessweek 

Bloomberg Businessweek on MSN Money


Consumers have plenty of ways to watch movies over the Internet. 


There's Netflix (NFLX), Amazon.com's (AMZN) Instant Video, Wal-Mart Stores' (WMT) Vudu and Apple's (AAPL) iTunes. Now the market for buying and renting films online is about to get more crowded.


A new service, Redbox Instant by Verizon (VZ), plans to throw open its virtual doors to customers willing to pay $8 a month. Subscribers will gain online access to a catalog of older films at no extra fee, an on-demand store of newer movies available for rent or purchase and DVD rental credits good for four recent releases each month from Redbox's kiosks at supermarkets and drugstores around the country.

 

The unveiling of a tool to help Facebook users find personalized results and trusted recommendations opens a door to new partnerships for the Web portal.

By TheStreet Staff Jan 16, 2013 4:14PM
thestreet logo

The Yahoo! offices in Santa Monica, Calif. © MARIO ANZUONI/Newscom/RTRBy Eric Jackson, TheStreet 


A lot of attention following Tuesday's news that Facebook (FB) would enter the search business has focused on the prominence of Microsoft's (MSFT) Bing as its backup for Web searches.  

 

The news gave Microsoft shares a boost, temporarily lifting the stock back above $27. (Microsoft publishes MSN Money.)

 

But what does the launch of Facebook's Graph Search mean for Yahoo (YHOO)? On the surface, nothing. But once you dig below the surface, it's interesting to see where Yahoo fits into these developments. 

 

More than one-third of Americans consult search engines with medical issues, according to a new report. One in six go online to seek out others with the same health concerns.

By MSN Money Partner Jan 15, 2013 2:34PM

The homepage of the NHS © Photo Illustration by Daniel Berehulak/Getty ImagesBy U.S. News & World Report U.S. News & World Report on MSN Money


If you've ever tried to identify a sniffle, pain or rash with an Internet search, you're not alone.


Thirty-five percent of U.S. adults have jumped online specifically to figure out what medical condition they or another person may have, according to a Pew Research Center survey of about 3,000 people, released today.

 

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

ABOUT TECHBIZ

Start investing in technology companies with help from financial writers and experts who know the industry best. Learn what to look for in a technology company to make the right investment decisions.

RECENT QUOTES

WATCHLIST

Symbol
Last
Change
Shares
Quotes delayed at least 15 min

MARKET UPDATE

NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.
NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.
Market index data delayed by 15 minutes

[BRIEFING.COM] The stock market ended the holiday-shortened week on a mixed note as the Dow Jones Industrial Average shed 0.1%, while the S&P 500 added 0.1% with seven sectors posting gains.

Equity indices faced an uphill climb from the opening bell after disappointing quarterly results from Google (GOOG 536.10, -20.44) and IBM (IBM 190.04, -6.36) weighed on the early sentiment. Google reported earnings $0.15 below the Capital IQ consensus estimate on revenue of $15.42 ... More


Currencies

NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.

MSN MONEY'S