Interesting read:
www.calcalistech.com
How does Israel fit into the new vision you formulated for Intel that you announced shortly after you took office?
“Israel has become Intel's second-largest operation after the U.S and we will continue to grow and expand here. I'll be very surprised if we don't do a few more acquisitions here. Intel acquired Mobileye, Habana, Cnveg, Screenovate, and now Tower. We love Israel.
Regarding Tower, I still have a lot of work to do to complete the deal, like getting the regulatory approvals, but I expect Tower to become another path of growth for Intel. We have announced a major plan to establish a chip manufacturing plant for external customers and part of the reason for purchasing Tower is that Intel does not have such DNA and Tower has been doing so for years. We open ourselves to becoming a service provider for external customers who will design and manufacture our processors with us. Intel does not have such an arm today. We've talked about it a few times before, but we did not do it in a big way. I need to learn how to be a good service organization so that customers can use us to design processors. The second thing Tower brings is variety. Imagine you go to a Chinese restaurant and you see that there are only five items on the menu, you’d say to yourself 'this is not a real Chinese restaurant'. Well, Tower had a lot more choices on its menu."
"We will expand Tower's activities"
As part of Intel's new vision, Gelsinger decided that the company would stop pursuing trends in markets most of which it eventually missed out on by betting on the wrong direction under a string of CEOs who have led the company over the past decade. One of Intel's biggest shortcomings is considered to be that of the mobile and smartphone market, but now Gelsinger focuses on the traditional computing division, in which the Haifa Development Center plays an important role, by way of an autonomous vehicle, a division based on the activities of Mobileye and its headquarters in Israel. Another important element is the data centers and networks, the "brains" of which were built on the basis of Israel’s Habana Labs. The fourth arm is the graphics division, where here too Intel missed the big leap made by Nvidia, once the small and almost esoteric competitor that made a huge leap and overtook Intel at a market value of $600 billion, compared to Intel's $192 billion. A new division is Foundry (Intel Foundry Services), manufacturing chips for external customers according to their design and requirements. This is an entirely new muscle of Intel that is used to dictating to everyone the tone of what will be inside the processor as a company founded and run by people who invented the field, Andy Grove and Gordon Moore. This new division is based on Tower, until recently a company almost completely hidden from view, with many question marks about the need for its existence hovering around it since its inception.
How did Tower even get on your radar? This is not a big company in global terms and in Israel their exit was received with great surprise.
"When we announced the new vision in the second quarter of 2021 and started to build our capabilities organically first of all, we immediately started looking for inorganic alternatives as well. And here, too, one can use the menu parable - in the field of chip production for the design of others, there are not so many players. There is a fairly short list of companies. As we looked and debated whether to acquire more chip production capability in the most advanced technologies or in the second tier we came to the conclusion that what we have today and is the latest technology, will age later and become the second tier. For the memory chips (Flash) we decided not to go in and it left us quite clearly with the special chips which is exactly the field of Tower and the expertise it brings. We started talking to them towards the end of last year, there was widespread support on the board, we talked about the price, found a happy medium, and we reached an agreement in terms of value.
Are your customers aware that when producing with Tower some of which is in Israel?
"Tower has factories in Japan, Europe, and the United States, except for Israel. Of course, in light of our expansion in Israel in Kiryat Gat, we expect the share of the manufacturing business outside Israel to increase further. I'm not sure we will make any more acquisitions in the manufacturing field, but there will be more acquisitions in Israel. I've already done two - Screenovate and Tower in my first year as CEO.
Tower & Intel offices (Credit: Tower, Intel)
Will you need all the employees and all of Tower's sites or are cuts expected after the deal is completed?
"Not only will we save, but we will also expand Tower's activities. I see two dimensions - the menu will also expand greatly, we will add both the things Tower offers and the things Intel offers. And interesting things can be done by combining capabilities. The factories that support the menus will be larger. We will also leave Tower's sites in Japan and Europe, as well as in Texas, and it is possible that we will only move the site in Newport Beach because the lease there is about to expire in any case in the coming years."
So Tower’s employees in Israel have no reason to worry?
"Absolutely, it's part of my visit here, to meet the guys at Tower. We want to expand the menu and also increase the ability to produce the dishes. Today companies look at Tower and say 'you are a good factory but you are not big enough to meet the production needs’. There will be no such concern with Intel."
Intel Inside: CEO shares his plans to restoring the chip giant’s supremacy | CTech
A year after taking over the helm, Intel CEO Pat Gelsinger sees Israel as a key piece of the puzzle
www.calcalistech.com
How does Israel fit into the new vision you formulated for Intel that you announced shortly after you took office?
“Israel has become Intel's second-largest operation after the U.S and we will continue to grow and expand here. I'll be very surprised if we don't do a few more acquisitions here. Intel acquired Mobileye, Habana, Cnveg, Screenovate, and now Tower. We love Israel.
Regarding Tower, I still have a lot of work to do to complete the deal, like getting the regulatory approvals, but I expect Tower to become another path of growth for Intel. We have announced a major plan to establish a chip manufacturing plant for external customers and part of the reason for purchasing Tower is that Intel does not have such DNA and Tower has been doing so for years. We open ourselves to becoming a service provider for external customers who will design and manufacture our processors with us. Intel does not have such an arm today. We've talked about it a few times before, but we did not do it in a big way. I need to learn how to be a good service organization so that customers can use us to design processors. The second thing Tower brings is variety. Imagine you go to a Chinese restaurant and you see that there are only five items on the menu, you’d say to yourself 'this is not a real Chinese restaurant'. Well, Tower had a lot more choices on its menu."
"We will expand Tower's activities"
As part of Intel's new vision, Gelsinger decided that the company would stop pursuing trends in markets most of which it eventually missed out on by betting on the wrong direction under a string of CEOs who have led the company over the past decade. One of Intel's biggest shortcomings is considered to be that of the mobile and smartphone market, but now Gelsinger focuses on the traditional computing division, in which the Haifa Development Center plays an important role, by way of an autonomous vehicle, a division based on the activities of Mobileye and its headquarters in Israel. Another important element is the data centers and networks, the "brains" of which were built on the basis of Israel’s Habana Labs. The fourth arm is the graphics division, where here too Intel missed the big leap made by Nvidia, once the small and almost esoteric competitor that made a huge leap and overtook Intel at a market value of $600 billion, compared to Intel's $192 billion. A new division is Foundry (Intel Foundry Services), manufacturing chips for external customers according to their design and requirements. This is an entirely new muscle of Intel that is used to dictating to everyone the tone of what will be inside the processor as a company founded and run by people who invented the field, Andy Grove and Gordon Moore. This new division is based on Tower, until recently a company almost completely hidden from view, with many question marks about the need for its existence hovering around it since its inception.
How did Tower even get on your radar? This is not a big company in global terms and in Israel their exit was received with great surprise.
"When we announced the new vision in the second quarter of 2021 and started to build our capabilities organically first of all, we immediately started looking for inorganic alternatives as well. And here, too, one can use the menu parable - in the field of chip production for the design of others, there are not so many players. There is a fairly short list of companies. As we looked and debated whether to acquire more chip production capability in the most advanced technologies or in the second tier we came to the conclusion that what we have today and is the latest technology, will age later and become the second tier. For the memory chips (Flash) we decided not to go in and it left us quite clearly with the special chips which is exactly the field of Tower and the expertise it brings. We started talking to them towards the end of last year, there was widespread support on the board, we talked about the price, found a happy medium, and we reached an agreement in terms of value.
Are your customers aware that when producing with Tower some of which is in Israel?
"Tower has factories in Japan, Europe, and the United States, except for Israel. Of course, in light of our expansion in Israel in Kiryat Gat, we expect the share of the manufacturing business outside Israel to increase further. I'm not sure we will make any more acquisitions in the manufacturing field, but there will be more acquisitions in Israel. I've already done two - Screenovate and Tower in my first year as CEO.
Tower & Intel offices (Credit: Tower, Intel)
Will you need all the employees and all of Tower's sites or are cuts expected after the deal is completed?
"Not only will we save, but we will also expand Tower's activities. I see two dimensions - the menu will also expand greatly, we will add both the things Tower offers and the things Intel offers. And interesting things can be done by combining capabilities. The factories that support the menus will be larger. We will also leave Tower's sites in Japan and Europe, as well as in Texas, and it is possible that we will only move the site in Newport Beach because the lease there is about to expire in any case in the coming years."
So Tower’s employees in Israel have no reason to worry?
"Absolutely, it's part of my visit here, to meet the guys at Tower. We want to expand the menu and also increase the ability to produce the dishes. Today companies look at Tower and say 'you are a good factory but you are not big enough to meet the production needs’. There will be no such concern with Intel."