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Rufus D
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Retired investor after a 25 year career in Silicon Valley, with management, engineering, marketing, and angel investing experience in semiconductors, software, and peripherals. Today's investment plan: Let dog out, surf Seeking Alpha, let dog in.
  • Otellini Leaving Intel: It's Time For Intel To Get In The Game 0 comments
    Nov 20, 2012 2:57 PM | about stocks: QCOM, NVDA, ARMH, INTC

    Intel (NASDAQ:INTC) abruptly announced that CEO Paul Otellini will be retiring in May after an 8 year term and 40 years with the company. The departure seems to be amicable as Otellini will assist in the search for a replacement, and will be available as a mentor for the new CEO. Several internal candidates are possible replacements, but the Intel board says external candidates will be considered. Otellini has had a long and successful career as one of the key players in the semiconductor industry. We wish him well in his retirement.

    But it is time for change. Otellini did a nice job turning the ship in the PC and server business, and extending Intel's leadership in chip manufacturing technologies. These are the areas he knows and loves, and he was the perfect man for those jobs when he was promoted to CEO during a rather chaotic period at Intel in 2005. But like most companies that have a cash cow in place, he spent all his time and resources milking the cow, not looking to the future.

    Intel desperately needs a market oriented visionary leader who understands mobile, is looking at potential opportunities and partnerships, and is willing to make risk adjusted investments and acquisitions, and create industry changing initiatives. Intel did this repeatedly during the high growth phase of the PC business during the 80s and 90s, but lately not so much. The biggest silicon advances of the mobile revolution where created by Intel competitors like ARM (NASDAQ:ARMH), Qualcomm (NASDAQ:QCOM), Apple (NASDAQ:AAPL), Nvidia (NASDAQ:NVDA), and Samsung. These would be good places for Intel to look for a replacement.

    Andy Grove used to call them inflection points, and Otellini missed the biggest one in tech history, the mobile shift. Intel still (accidentally) benefited due to the growth of the cloud, but this was the vision of others, not Intel. I hope they can find a Bezos or Jobs to figure out how to properly spend that cash hoard they have built. Paying higher dividends and share buybacks will not help us maintain our technology lead in the 21st century. We need Intel to get in the game.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

    Stocks: QCOM, NVDA, ARMH, INTC
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