And what is Intel's status. That is, pre-McAfee acquisition?
James: We have some hardware security features in our silicon today that allow software companies like McAfee to do anti-theft. That is, turn off the PC if it's stolen, the next time it connects to the network it's blocked, that kind of thing. And we have multiple vendors who are partners with us on this. But we do not have any software or services products in security today. And I don't think we could catch up to the knowledge base and experience and IT portfolio of this company (McAfee).

There are things you've already been doing with McAfee before the announcement which led to the acquisition.
James: What's happening is that we're partners with them, working with them, using existing features in the microprocessor today such as VT (virtualization technology), AMT (Active Management Technology), things that have been in products for years. And it was through our conversations and prototyping there. (We thought that) with much deeper discussion and sharing of R&D opportunities we would come out with an enhanced line of software and services products. We thought about that and how that's really exciting to us. Except, how would we get paid for that? McAfee would get paid (but Intel wouldn't). Intel's platforms could be measurably better, consumers could be better off. But how would our shareholders get paid back for that opportunity? Which led to us make the consideration of the acquisition.

(Editor's note: The upshot is that in the future there would be McAfee software that would take advantage of technology built into Intel chips to enhance security.)

https://www.cnet.com/news/intel-exec-renee-james-discusses-goals-for-mcafee-q-a/

And Intel chips and McAfee technology, how do they fit together?
James: Security can be enhanced with hardware. You can have a software-only solution but it can be made more robust in conjunction with hardware. That combined value proposition is one of the sources of motivation for this acquisition. We can actually add enhancements into our silicon that can offer the consumer more protection. There are a number of opportunities where hardware could assist the software, either preventing attacks or recovering from attacks, or hardening the software against certain attacks. Those are the kinds of things we think about. McAfee will continue today to sell all of their products in the open market, across platforms. But they may have a line of enhanced security products that take advantages of silicon features. But some of this is out several years. We need to set the proper expectations.

How does this fit in with Intel's strategy?
James: When you think about things like power efficiency or performance or Internet connectivity as major technology areas where you have multiple investments, multiple products--security is like that. Security is applicable to our products in the data center, laptops, desktops, and any Atom-based devices--whether they're embedded, TVs, automotive, or phones and tablets. Security is a major purchase criteria and a concern. So, it spreads across the whole product line.

Q: What do you see as McAfee's strengths?
Renee J. James: McAfee's No. 1 strength is that they have a fantastic R&D team, engineering, as well as research at the core of security: database threat management. They've augmented that with some very key acquisitions over the last two or three years. On a forward-looking basis, their core technology is very well positioned for mobile, for cloud-based security, for where I think security is heading. They're not a market segment leader in AV (antivirus). It's an important business and continues to be an important business but they have other assets that are equally important. And they're a pure play security company. That was another thing that was appealing to us. And they've been a solid growth company quarter over quarter, year over year.