Analysts and press constantly talk about a serious slowdown in the PC business and hardware spending. Have we come to a point where a major paradigm shift in technology and strategy will be the only way to drive continued growth for a company like Intel?
The PC industry slowdown is really a function of the economy. It’s not because the long-term demand for PCs is waning. If you look at what’s happening with cell phones or even the telecom industry, there is a slowdown across the board. The same analysts who say the PC market is saturated, dead and gone, are the same ones who, six months ago, said “go buy telecom stocks!” How many of those analysts today have sell orders? The same analysts that were clueless about the telecom sector are now clueless about what’s happening in the PC industry.

What market forces will drive growth?
We can look at three underlying trends that are part of the bedrock of the semiconductor business. The first trend that is shaping every company in the world is B2B e-commerce. In 2000, Intel did about $24 billion in sales over the Internet. We are implementing our backend e-commerce infrastructure. In between, we are working to get our many business units to be interrelated. We’re doing all of this because real cost savings can be achieved by going to an e-business infrastructure. And we’re not the only ones doing it.

So why is this important as a bedrock for semiconductors? Because the infrastructure that needs to be deployed for widespread e-business hasn’t been deployed yet. You will need new servers and high performance clients. This is a fundamental trend that will drive technology investment.