Source Code: Your daily look at what matters in tech.

source-codesource codeauthorDavid PierceNEWSLETTER LayoutWant your finger on the pulse of everything that's happening in tech? Sign up to get David Pierce's daily newsletter.64fd3cbe9f
×

Get access to Protocol

Will be used in accordance with our Privacy Policy

I’m already a subscriber
Protocol Source Code
What matters in tech, in your inbox every morning.

Intel’s $20 billion bet on chips

Image: Slejven Djurakovic / Protocol
Intel’s $20 billion bet on chips

Good morning! This Wednesday, Intel has a plan to solve the chip shortage, AWS has a new CEO, Slack becomes a complete messaging app and Prince Harry gets a tech job.

(Was this email forwarded to you? Sign up here to get Source Code every day. And you can text with us, too, by signing up here or texting 415-475-1729.)

The Big Story

What to know about the new AWS CEO

Anna Kramer writes: The biggest name in cloud has a new CEO: Adam Selipsky. Here are a few things you should know about the man who will now control AWS — and, by extension, an awful lot of the internet.

  • He's an AWS veteran. Selipsky was one of the first VPs of AWS, hired in 2005 to work at Amazon right before the company launched its first popular data storage services. He went on to run AWS's sales, marketing and support for more than a decade, helping prime AWS for the behemoth it would become. He helped lead the company's EC2 and S3 storage service when it launched shortly after his hire.
  • He helped nearly quadruple Tableau's value during his time as CEO. Selipsky became Tableau CEO in 2016, and led the company's transition to subscription licensing for its software, embracing a popular and lucrative trend for SaaS companies at the time.
  • And then he sold to Salesforce. Salesforce acquired Tableau for $15.7 billion in 2019, and Selipsky stayed on as CEO. Marc Benioff, by the way, often said he considered Selipsky a key leader at Salesforce.
  • Selipsky wasn't necessarily the betting favorite for this job. That would probably have been Matt Garman, the AWS executive who currently holds Selipsky's former role. But Selipsky's role was left empty for years, and Garman was only moved over to that position last year; he was president of the compute services division for years before that.
  • He has a long marketing background. Before he joined AWS, Selipsky was a VP at RealNetworks, where he was eventually responsible for more than a third of the company's revenue. He spent much of his time there as a VP for consumer marketing and a GM for media systems marketing.
  • He's a Seattle native, a Harvard grad and a self-confessed "wine guy."

After Selipsky takes on the new role in May, Amazon CEO and former AWS CEO Andy Jassy said the two of them will "spend the subsequent weeks transitioning together." Then Selipsky will assume the top job sometime in the fall.

And while Selipsky is not what anyone would call an out-of-the-box hire, hey, at least his name isn't Jeff.

Semiconductors

Intel to the chip rescue

Pat Gelsinger hasn't been Intel's CEO for very long, but he's already shaking up the company. Gelsinger announced yesterday that Intel plans to spend $20 billion to create new factories in Arizona, Protocol's Tom Krazit writes — and those new facilities won't just create chips for Intel.

The investment will underpin its third-party manufacturing business, Intel Foundry Services — a small part of the company that is about to become decidedly not small. Randhir Thakur, the head of IFS, is about to become very important.

  • In addition to making its own chips — vertical integration has always been a key part of Intel's pitch — Intel will now build chips designed by other companies. And it'll license its own designs for those chips.
  • Intel has made chips for other companies before, but even Gelsinger acknowledged that "our first efforts were, you know, somewhat weak." Now, he said Intel is pushing much harder.
  • This puts Intel in direct competition with the chip giants like TSMC and Samsung, though the company will still rely on those companies for parts of its chips.

This is Intel's way of addressing the global chip shortage, and the fact that the U.S. is no longer a lead in chip manufacturing.

  • "With most of the growth coming from leading-edge computing, which is our expertise, the majority of leading-edge foundry capacity is concentrated in Asia, while the industry needs more geographically balanced manufacturing capacity," Gelsinger said.

All this is going to take a while. Gelsinger said himself that Intel won't be back to "unquestioned CPU leadership performance" until at least 2024.

  • Anyone watching Intel recently is going to take the over on that bet: A string of manufacturing issues when making its own chips might dissuade potential customers from using its fabs.
  • And there's the age-old tech problem of competing with your customers. Will Apple want Intel to make its chips, given that its chips are in direct competition with Intel's?

But hurdles aside, this is a very big deal. It's big for Chandler, Arizona, where two new plants will be built inside an existing Intel facility. (Intel's promising 3,000 new high-tech jobs in the area. And don't forget TSMC is also building a factory in Arizona.) It's big for the Biden administration, which gets a win in its efforts to make the U.S. more competitive in the semiconductor space. And it's big for Intel, which desperately needs a path back to the top of the chip world. No pressure, then, Pat.

Work

Slack opens up

Slack is a full-fledged messaging app now. Starting today, you can Slack with any other Slack user on the planet. All you have to do is invite them. It's part of Slack's plan to become much more than a way you chat with your coworkers: It wants to be your entire workplace, your entire industry, all in a single app.

Slack's pitch goes like this: Slack is more secure and more IT-manageable than email, it's more powerful than text messages, and it's simpler and less invasive than incessant phone calls. Plus, you're probably already in it all day.

  • "When someone opens up their phone," Ilan Frank, Slack's VP of product, told me last week, "if they're connecting with their friends, they click on Facebook or WhatsApp. If they're connecting with someone they work with, regardless of where that person works, they should be clicking on Slack."

It's a clever move for Slack, not to mention a much-needed one; Microsoft Teams and Google Chat are pretty clearly going to sew up the "chat with your co-workers" market just by virtue of being free and bundled. Slack is leaning into being the connective tissue for all the people you talk to for work, all the apps you use and all the stuff you deal with. It's an organizational layer masquerading as a messaging app.

  • Here's how to use Connect DMs: Click on "Add External People" in your Slack sidebar (or go to Slack Connect if you don't see it) and type in someone's email address. If they use Slack, they can start chatting right away; if not, they can join Slack and jump in.

If you want to know more, I wrote a bigger story about Slack's plans, and interviewed Chief Product Officer Tamar Yehoshua on the Source Code podcast. And if you want someone to Slack with, I'm always here.

A MESSAGE FROM AMAZON

A recent report studying voluntary increases to wages by businesses found that when Amazon raised its pay to $15 in 2018, it led to a 4.7% increase in wages for employees at other companies in the same market. The study also found no significant job losses in the community after the wage increase.

Read more

People Are Talking

On Protocol: Most people have no idea what it's like to work in an Amazon warehouse, "Fulfillment" author Alec MacGillis said:

  • "A big goal of my book is to get the average upper-middle class consumer to reckon more with what's behind the one-click — all the strenuous exertions that that one-click sets off within the warehouses."

In announcing the umpteenth pivot for Medium, Ev Williams said he'd decided once again that running publications wouldn't work and funding creators is the future:

  • "Trust is more important than ever and well-established editorial brands still have meaning. But today, credibility and affinity are primarily built by people — individual voices — rather than brands."

Proton CEO Andy Yen said that "Apple stands in the way of human rights":

  • "Apple has no problem challenging governments when it is in its own financial self-interest (e.g., avoiding EU taxes or evading antitrust charges). However, when Proton does it for human rights reasons, it's suddenly against Apple's policies."

Sundar Pichai sent a note to Googlers last week, after the shootings in Atlanta:

  • "I know the effects of the hateful violence reach way beyond Atlanta. The loss of these eight lives is tragic — and so is the reality that anybody would be targeted because of their race or gender as appears to be the case here and in so many other recent incidents."

Making Moves

Prince Harry (yes, that Prince Harry) is the new chief impact officer at BetterUp. He'll work on "product strategy decisions and charitable contributions," The Wall Street Journal reported.

Jenna Owens is the new COO at GameStop, joining from Amazon.

Stacey Epstein is the new CMO at Freshworks, joining from ServiceMax.

Sharon Chiarella is the new chief product officer at Stitch Fix, joining from Amazon.

Gilles BianRosa is N26's new chief product officer, joining from SoundCloud.

Robinhood confidentially filed for an IPO. It could reportedly go public next quarter.

On Protocol | Enterprise: ServiceNow bought RPA provider Intellibot, with plans to incorporate India-based Intellibot's automation capabilities into its own product suite. UiPath, meanwhile, bought Cloud Elements.

Twitter acquired API platform Reshuffle, as it continues to try and improve its relationship with developers.

In Other News

  • On Protocol: Former Parler CEO John Matze sued the company. He accused conservative financier Rebekah Mercer of plotting to "force [him] out" as CEO of Parler and "steal" his 40% stake, following the Capitol riot on Jan. 6.
  • Apple and Goldman Sachs didn't deliberately discriminate against customers with the Apple Card, a New York financial regulator found. It said there was no evidence that the card intentionally gave women a lower credit limit than men.
  • You can now buy a Tesla with Bitcoin. But … I wouldn't? If you're a Tesla believer, you're probably also a Bitcoin believer, and if both keep going up your Model S might end up costing you Rolls-Royce money.
  • Amazon drivers must sign a "biometric consent" form to keep their jobs, Motherboard reported. The form gives Amazon permission to use cameras and other biometric tech to monitor drivers.
  • Verizon's all-in on the Yahoo brand, rebranding its media products with the Yahoo name and launching Yahoo Plus subscriptions.
  • More Disney movies will premiere simultaneously on Disney+ and in theaters. "Black Widow" and "Cruella" will be available for an additional fee on Disney+ the same day they debut in theaters, while "Luca" will mostly skip theaters and be available to stream for free.
  • Qualcomm might get into gaming. Android Police reported that the company is working on a games console that looks similar to the Nintendo Switch, reportedly planned for a 2022 launch.
  • Tencent's Pony Ma met with Chinese antitrust regulators, Reuters reported. It's a sign that Tencent might be next in regulators' firing line, after Ant and Alibaba.
  • Facebook allows calls for the death of public figures, The Guardian reported, citing leaked moderator guidelines. Public figures can't be tagged in those posts, though.

One More Thing

Mars House

NFT of the day

It's a house! Not a real house, obviously, a digital NFT house. But "Mars House" sold for real-house money, hitting 288 ETH (or about $512,000). Still, there's a twist: Everything in the design is possible to make in the real world, and the buyer also won the right to use the house in digital worlds too, but only on "a single Metaverse platform." It'll be the nicest house in Roblox, I can tell you that much.

A MESSAGE FROM AMAZON

A recent report studying voluntary increases to wages by businesses found that when Amazon raised its pay to $15 in 2018, it led to a 4.7% increase in wages for employees at other companies in the same market. The study also found no significant job losses in the community after the wage increase.

Read more

Today's Source Code was written by David Pierce, with help from Anna Kramer and Shakeel Hashim. Thoughts, questions, tips? Send them to david@protocol.com, or our tips line, tips@protocol.com. Enjoy your day; see you tomorrow.

Recent Issues

Escaping Big Tech