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Intel pursues expansion plans

Intel Corporation to continue investing in its communications business despite slowdown in demand for equipment, president and chief executive officer Craig Barrett promised.

In his address to the Networld+Interop trade show in Las Vegas, Barrett said Intel would continue to expand through acquisition, product development, and investment in companies that support its initiatives.

Intel plans to spend 30% of its $4.2bn (£2.95bn) R&D budget this year on these developments, which include silicon germanium process technology and making 10 gigabit Ethernet available to city networks, he said.

Barrett urged communications industry leaders to maintain investment in the technologies required to build next generation networks, adding that companies will demand networks that bring together voice, data and wireless into a single, packet-based system.

"It's clear that separate and inefficient networks for wireless, data and voice communications will converge into a more efficient single network. Faster networks will always replace slower ones," Barrett said.

While infrastructure demands are still growing, Barrett said networks that combine voice and data capabilities will fuel growth for the communications industry over the long term.

"While others may be paring back in the current environment, we believe it is in Intel's strategic interest to continue investing in our communications business. We urge others to join with us in investing to help build the next generation of networks. Together, the digital world is ours to build," he said.

Barrett demonstrated a live high-definition online TV broadcast using the Internet2 protocols, designed by a consortium led by 180 universities, which have been working with industry and government to develop advanced network applications.

Last month, Intel acquired three companies for their electrical components technologies. These are used in optical networking equipment, a key component of Intel's road map.

Of the acquisitions, Cognet and nSerial develop high-speed components for 10-gigabit Ethernet modules, while LightLogic provides transponders for the metropolitan market.

Meanwhile, Compaq is set to use Intel's new ultra low-voltage processor code-named Tualatin as part of is forthcoming hyper-dense server architecture QuickBlade, slated for release in the second half of the year. With an ever-growing number of servers in the workplace, Compaq aims to meet the demand for denser machines that use less power.

But Intel is being held up by a manufacturing problem that could delay plans to ship Tualatin later this year. The chip should be released in the summer, but volumes could be affected by a delay in the delivery of a key chip-making machine.

Chris Mugan

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