Vish Viswanathan Director Manufacturing Computing IT Intel Corporation

Vish Viswanathan Director, Manufacturing Computing IT, Intel Corporation Intel is a registered trademark of Intel Corporation or its subsidiaries in the United States and other countries. *Other brands and names are property of their respective owners 1

Moore’s Law - Drives the Industry 1 billion transistor CPU by 2007 Moore's Law Continues! 2

Microprocessor Clock Frequency 10 GHz by 2007 10, 000 Pentium® 4 Processor 1, 000 Pentium® II Processor 486™ Processor 100 MHz 10 4004 1 8085 8080 286 Pentium® III Processor Pentium® Processor 386™ Processor 8086 0. 1 1970 1980 1990 Source: Intel 2000 2010 3

Entering Intel’s Third Era Technology, product & market synchronization is critical Different market segments have different business drivers and timelines 4

Semiconductor Fab Costs 10, 000 Fab Cost ($ M) Source: VLSI Research $3 B 1, 000 10 1 1970 1975 Moore's “ 2 nd Law”: 1980 1985 1990 1995 2000 2005 Factory costs increase exponentially to meet demand 5

Capital Cost are High $B 6. 0 Capital Cost for a 300 mm Factory ~$3 B 5. 0 4. 0 3. 0 Technology Lifecycle - 2 years 2. 0 1. 0 Hitachi Winbond Sony NEC Toshiba Matsushita Fujitsu Philips Chartered Mitsubishi Infineon TI AMD UMC Micron STMicro IBM* Samsung TSMC Intel 0 Drives the need for high utilization of equipment and high employee 2002 Capitalproductivity Spending 6

Global Manufacturing Washington Systems mfg Ireland Fab Oregon Fab, Board mfg Colorado Fab California Fab Mass Fab Arizona Fab, A/T New Mexico Fab Puerto Rico Board mfg Costa Rica Assembly/test Israel Fab Shanghai Assembly/tes Philippines Assembly/Test Malaysia Assembly/Test, Board/module mfg 7 x 24 x 365 Non-stop operations 7

Improvement in 12 years Circa 1988 Drives need for internal availability of data and supply chain synchronization 8

Key IT Business Challenges • Enable 100% e-Corporation • Satisfy the demand for ever increasing computing power and bandwidth by business groups • Operations Excellence (Keep the business running) • Increase employee productivity • Information security • Reduce TCO 9

Intel IT Growth Indicators The Growth of Intel and IT 1998 2001 % Increase 65, 800 83, 000+ 26% Enterprise Release/Production Transactions/Month 20 M 41. 25 M 106% End-user customer satisfaction 60%+ Intel Employees Supported 87% 27% Intel Sites with IT Employees 25 70 180% Telephony Minutes per Month 7. 8 M 259% Average LAN Bandwidth Available per Employee Engineering Computing Capacity Hours 2. 25 Mbps 11 Mbps 389% 80, 000 500, 000 525% 100 800 700% E-Business and Enterprise Application Servers Supported*145 2140 1376% Different Software Applications Distributed Emails per day 1. 7 M 4. 5 M IT Employees 3, 100 4, 100 165 % 32% IT Spending $598 M $789 M 32% *Many server transfers (support) from business units to IT + Data is for 1999 10

100% e-Corporation Employee Retiree Intranet / Portal Environment Service Provider Current Employee ERP Service Supplier SPS B 2 Bi Supplier Business & Home User CPS DSS Direct EAI Material Supplier Goods Supplier Acquired Employee Capital Equipment Supplier Contract Manufacturer Future Employee EAI Contract Manufacturer Direct Customer B 2 Bi Reseller & VAR Customer Solution Enabler Business Process Data Standard Technologies 11

Hard Work on e-Business Has Just Begun 3 Phases of e-Business Evolution <1% Pervasive e-Business 31% Integrate Externally Integrate Internally 51% Service Sales Web Sites Early Integrating This content was provided by IBM CIO Conference, March 5, 2002 Advanced 12

Many Supply Chain Linkages Internal Customers Internal Suppliers intel Virtual Factory network Factory D Factory A Œ Factory C Factory B External Suppliers ‘ External Customers 13

Enabling Supply Chain e-Business Intel Supplier Customer data flow Deliver Source Make Deliver Source material flow INTERNET Supplier INTRANET Internal INTERNET Customer Supplier. intel. com Forecast/Response Inventory/ Replenishment Data PO/Invoice/Payment Product Data Mgmt Shipment Tracking Materials Quality Direct Materials Portal Document Exchange 14

Supply Chain • Improved Inventory Management • Faster time to Information • Procurement Savings Standards (Rosetta. Net) ~300 Suppliers ~200 Suppliers ~1000 Suppliers ~32, 000 Suppliers Extensive supply chain network needs to be coupled to development and manufacturing 15

Example- Connectivity with Equipment Suppliers Intel factories Equipment life-history Procurement Planning PO Through Delivery Install and Qualify Productive Operation Retire/ Resale Non-proprietary Communications and Security standards Examples: Rosetta. Net, PIPs, XML based, others Forecast sharing - equipment qty - Service Techs - Dock dates • Purchase orders • Invoice/SN • Acceptance • On-time delivery performance • Remote Diagnostics • Performance data sharing • On-line Spares mgt. • On-line manuals • Document sharing TBD 16

Supplier Linkages 17

Enabling Supply Chain e-Business Intel Supplier Customer data flow Deliver Source Make Deliver Source material flow INTERNET Supplier INTRANET Internal INTERNET Customer Factory Automation and Planning Systems Work Flow Control Advanced Process Control Scheduling/Dispatching Yield & Performance Mgmt Equip Remote Connectivity 18

Mfg Computing – The environment • Mission critical environment – Non-stop computing (24 x 7 x 365) , Uptime > 99. 99 – Tight change control & security • Enterprise class capabilities – Complex Application Integration (> 100 Apps, > 2000 msgs/sec) • Capability introduction synchronized with new mfg process generations (every 2 years) • Long sustaining life cycle (10+ years/process generation) • Maintain lower TCO - Mainstream products technologies. 19

Managing innovation and risk Technology Pipeline G 3 Research $/year: Risk taken: Tech focus: Mgmt focus: ~ 107 High Evaluate Plan G 2 Development ~ 108 G 1 Manufacturing ~ 109 Moderate Low Integrate Control Synchronize Replicate Source : Sunlin Chou 20

300 mm Wafer Factory – Fully Integrated System Goal: Direct tool to tool material movement without human intervention 21

Automation Components Tool control Tool setup Data collection Statistical Process control Process Equipment Interface Stockers Monorail systems Control systems Scheduling systems Manufacturing Execution HW, networks and User interfaces Automated Material Handling Workflow control Equipment Management Engineering specifications Experiment execution SPC Engineering Analysis Yield analysis Device performance analysis Advanced process control 22

Mfg Computing – The environment • Mission critical environment – Non-stop computing (24 x 7 x 365) , Uptime > 99. 99 – Tight change control & security Any downtime for all wafer fabs combined per week 23

IA/Windows – The Backbone in Mfg Mission Critical Automation Servers IA versus Non-IA # Servers/Factory 70 60 IA - Server 50 Non-IA Servers 40 30 20 10 0 1995 1997 1999 Max Database Size 2001 2003* 1. 5 TB CPUs 4 To 8 Way Memory 4 GB to 16 GB Max Concurrent Users 1200 Max Txn/Min/Server 72000 Storage Switched FC Fabric, 4 TB/SAN Island 2000 High Availability MSCS/NLBS/CLBS DB/Web/App Clusters Messages/Sec Intel is a registered trademark of Intel Corporation or its subsidiaries in the United States and other countries. *Other brands and names are property of their respective owners 24

Migration to Intelâ Architecture(IA) – $452 M Cost Saving 5 year Results Projected spending to achieve equivalent RISC capacity 300 Capital ($M) 250 200 Computing Demand: 86% annual growth rate 150 100 50 0 200 M 180 M 160 M 140 M 120 M 100 M 80 M 60 M 40 M 20 M 0 Compute Capacity Normalized Hrs Computing growth versus spending Year RISC Replaced $M’s Saved ’ 97 -’ 00 3, 413 $99 M 2001 4, 931 $143 M 2002** 7, 241 $210 M Total $452 M 1994 1995 1996 1997 1998 1999 2000 2001 2002 New Capital ($M) IA savings ($M) Computing Growth Actual spending levels About 70% of computing now on IA => $452 M savings by end of 2002 l l l Replacing $35 K RISC-Unix box with $7 K IA/Linux box for same RTL function Majority of this is TIER 1, some TIER 2 (front-end RTL simulation in design flow) All compute servers coupled together with peer-peer system Intel is a registered trademark of Intel Corporation or its subsidiaries in the United States and other countries. 25

Enabling Supply Chain e-Business Intel Supplier Customer data flow Deliver Source Make Deliver Source material flow INTERNET Supplier INTRANET Internal INTERNET Customer Price & Availability Order Placement WOM Confirmation # Shipment Data (Freight) Inventory Data SLM Exchange (to the web) Quotes Backlog Information Access Invoicing/Cash Payment 26

Productivity Opportunity: Collaboration, mass The Next Revolutionmobility, Windows XP*, User Productivity Mobility Windows. NET*, knowledge management First wave notebooks Mainframe to PC Internet PC e. Mail Time Today *Other brands and names are property of their respective owners 27

Increase Competitiveness PC Performance Gap Is Widening MHz 3000 Mainstream - Highest Performing Installed PC Value - Lowest Performing Installed PC Collaboration 2500 2001 -2002: 1 GHz + Gap! 1500 Data Visualization Internet 1000 1999: <400 MHz Gap 500 Productivity Apps 0 1998 1999 2000 2001 2002 2003 28

Inside Intel…. Faster transitions We’re Buying High Performance headroom l New features èRequires stable platforms Platform Performance l Intel roadmap Intel IT purchases Windows 2000* capable Windows NT 4* capable 1997 1998 1999 2000 2001 2002 Deployment goal: GA+90 Stable platforms enable us to balance efficiency and effectiveness 29 *Other brands and names are property of their respective owners 29

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