Former Intel execs are fighting over whether splitting the company in two is a good idea and if the US government should step in to cleave it in twain
Intel's (very) public troubles have inevitably invited every tech commentator on the interwebs to posit a theory as to what should be done next with the troubled chipmaker. While Intel itself seems to be debating which bits to carve off to survive, several former executives have made their opinions known as to whether carving the company up is the best way forward, or whether that's a terrible idea for both Intel and the US as a whole.
Four former Intel directors have written a column for Fortune, suggesting that Intel should be forced to split its chip design and foundry business by the US government (via Tom's Hardware). They argue that, as Intel is the only large-scale American manufacturer of advanced semiconductors, it's in the interests of the US government to leverage its CHIPS act funding to force Intel «down a better path» by severing the chip maker into two separate businesses, just as AMD separated its manufacturing arm into GlobalFoundries back in 2009.
«The CHIPS Act gives the U.S. government $39 billion in grants to revive American semiconductor manufacturing. The government has already promised (but not yet disbursed) up to $8.5 billion in grants and $11.5 billion in low-cost loans for Intel.
Today, Intel threatens to become this administration’s Solyndra (the solar company, which went bankrupt after getting more than $500m in government funding). This would be disastrous, both for the government and Intel.
The government has the leverage to force Intel down a better path—and it must use it now.»
However, former Intel CEO Craig Barrett has also written a piece for Fortune, arguing the opposite. According to Barrett, only three chipmakers currently have the revenue needed to sustain research and development costs— Intel, Samsung, and TSMC. Splitting Intel in two, Barrett argues, would potentially leave its foundry business without the necessary revenue to survive.
Given what happened to GlobalFoundries, it seems like a fair point. The company
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