Analysts were quick to scoff given the processor giant is a newbie to the system-on-chip business. But Otellini could have the last laugh considering the talent and money he is pumping into Intel's latest strategy to expand beyond the PC.

Intel's corporate SoC initiative still has its work cut out for it. First products out the gate such as the Tolapi chip for data center appliances and Canmore for digital TVs and set-tops have largely flopped.

But Intel continues to invest in SoCs, and there are signs it is gaining traction. A second-generation TV chip called Sodaville is said to be getting good reviews among consumer OEMs, and a new networking chip called Jasper Forest has won sockets in Hewlett-Packard storage arrays and wireless infrastructure gear from Nokia Siemens Networks and China's ZTE.

The handset market is Intel's next big target, promising to expand the company's available market from 300 million to 1.5 billion units a year. Intel tried and failed to make handset SoCs with its XScale processor, analyst Nathan Brookwood of Insight64 (Saratoga, Calif.) recalls. The company took too long to understand user requirements and turn them into shipping SoCs, he said of the product line eventually sold off to Marvell.

Intel re-enters the smartphone battle in earnest in 2011 when it ships Medfield, a 32nm Atom-based SoC aimed at handsets. At IDF, Otellini demonstrated a handset user interface for Intel's Moblin mobile Linux software that had some of the panache of the Apple iPhone and Palm Pre.

The SoC drive started two and a half years ago when Intel created a corporate SoC enablement group under Gadi Singer, the former head of EDA software at Intel and a veteran engineering manager who helped lead work on the initial Atom chip. His mission has been to turn the company known for its custom circuit expertise into a one skilled in the best practices of modular design for reuse.

Intel's reorg

In an unannounced part of Intel's recent reorg, Otellini elevated Singer's group in a sign of an increasing investment in SoCs. The group was paired with the Atom design team and put under Intel vice president Rob Crooke who reports to Dadi Perlmutter, Intel's top engineer and one of Otellini's direct reports.

So far Singer has helped put in place a common silicon library, SoC interconnect framework and SoC design flow. But he is quick to admit his work is far from finished.