Intel's sunny vision for the cloud

January 12, 2011: 5:00 AM ET

The chipmaker wants to standardize online computing. Will the rest of the industry get on board?

Can Intel do for cloud computing what it did for Wi-Fi? The chip company helped usher in ubiquitous wireless broadband seven years ago when it introduced its Centrino wireless platform for laptop computers and then teamed up with PC makers and hot spot operators such as Borders (BGP) and Hilton to evangelize Wi-Fi to consumers. Now Intel hopes to cajole the tech industry and others to embrace the delivery of software and other computing services over the Internet.

Intel (INTC) recently unveiled several initiatives aimed at making the cloud more omnipresent and open. (Translation: Services seamlessly work on any device, and software developers can build applications using a standard set of tools.) There's Intel's Cloud Builders program, which provides step-by-step guidance to companies that want to move data and services to the cloud. There's also the Open Data Center Alliance, a consortium of close to 70 companies Intel brought together to develop cloud-computing software and hardware standards.

Intel, based in Santa Clara, Calif., isn't a voting member of the alliance, and it claims its aim is to "rally the industry behind a vision that fulfills the cloud's true potential." Of course, the proliferation of server farms needed to host Net-based services is good for Intel. Its data center revenue (essentially revenue from processors, chipsets, and other components that go into servers) grew 30% in the third quarter, while PC revenue rose just 14%.

There's one hitch in Intel's grand plan to unify the industry: Cloud-computing heavyweights, including Amazon (AMZN), Google (GOOG), and Salesforce.com (CRM), don't want to participate. They're doing just fine without Intel's help. Amazon rules the field with its EC2 computing farm and S3 storage farm, which provide virtual data centers to smaller companies. Amazon doesn't need Intel's alliance to standardize the cloud -- for many enterprises, Amazon is the standard.

Analysts say such recalcitrance from Amazon and others isn't unexpected: These are early days for cloud computing, and its purveyors are too busy jostling for pole position to pull over and hash out the rules of the road. As more corporations seek to put critical software and operations online, they'll eventually require more of the flexibility and standardization that Intel is trying to promote.

In the meantime, Intel and its partners probably can afford to sit back and watch things play out. With corporate spending on cloud services expected to grow 30% in 2011, according to research firm IDC, there's probably enough new opportunity in the cloud for everyone -- including Intel.

Cloud computing: raining money

Four directions enterprise tech will take in 2011

Salesforce.com's new (and free) social networking tool

Join the Conversation
About This Author
Michal Lev-Ram
Michal Lev-Ram
Writer, Fortune

Based in Silicon Valley, Michal Lev-Ram covers enterprise and mobile technologies for FORTUNE. Prior to joining FORTUNE, she wrote for CNNMoney, Fast Company, Popular Science and other business and technology publications. She was also a staff writer at Business 2.0 and holds a B.A. in journalism from San Francisco State University.

Email Michal
Current Issue
  • Give the gift of Fortune
  • Get the Fortune app
  • Subscribe
Powered by WordPress.com VIP.