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The real news from Intel: Renee James takes over No. 2 spot

New president could shake up the company.

It was almost an afterthought in the announcement of Brian Krzanich as CEO, but Intel's decision to appoint Renee James as president of the company is huge news, far more so than Krzanich getting the big chair.

The choice of Krzanich is not much of a surprise and Wall Street had a decidedly "meh" response to the news. As COO, he was a logical choice. He's been focused on the production side of things, managing Intel's foundries, and he's an Intel "lifer," having worked his whole career with the company, just like outgoing CEO Paul Otellini.

His choice doesn't surprise me, either. Intel is known to have one of the most insular and difficult cultures in the Valley. While many firms are known for being casual and laid back, Intel drives hard, very hard. It relentlessly weeds out people who can't hack it or slack off. No one there is punching a time card and shuffling paper clips. So the odds of an outsider getting the pick were a long shot at best.

His selection is seen as Intel playing it safe, as someone who won't rock the boat. That's unfortunate because Intel's boat needs some rocking before ARM swamps it. The old tick/tock model Otellini helped drive no longer applies in a tablet and smartphone world.

That's where James may come in. James isn't an Intel "lifer," although she has spent the last 25 years with Intel. The fact she survived this long speaks for itself. In her early days, she was a technical assistant to CEO Andy Grove for four years. Her job was to make sure that Grove was kept up-to-date on the latest in technology, prepared his speeches and presentations, and generally kept up on the industry so Grove could focus on running the company.

Spending four years working with Grove is an education no college can give you. One of her projects after Grove left was to set up Intel Online Services, a data center outsourcing project that was similar to Amazon Web Services. Unfortunately she was a decade ahead of herself. When the Dot Com implosion hit in 2001, IOS was a victim of the economy and Intel shut it down.

As part of the software group, James has been involved in the development of Tizen, a Linux-based alternative mobile OS to Android. Intel is one of the few companies with the resources to compete with Google in a mobile OS. Intel has chips, OS engineers and a compiler business of its own, and it has Samsung's power and momentum. They better make this work.

James also sits on some very important boards, and that might play a part in Intel's future direction. She's a director at VMware, which is led by the guy a lot of people thought would lead Intel, Pat Gelsinger. In addition to that relationship, she understands the cloud even better than she did 13 years ago and the hot new trend, the "Internet of Things."

She's a director of Vodafone, which may help Intel figure out what it's doing wrong with the mobile market. After five years of trying, Intel has next to nothing to show for itself in smartphones. This job could make her Intel's point person on mobile devices.

That all leads up to the big kahuna, Apple. Otellini has been reluctant to deal with Apple because he considers it a competitor, which is kind of silly. Apple is too deep into ARM at this point to change, but if Intel can lure them away from Samsung as a foundry customer, that alone is a win.

In some ways, she should be the CEO because these are all areas that require vision. Krzanich is an ops guy. That would have been something if Intel picked her, because then three of the largest firms in this industry – IBM, HP and Intel – would all be led by women. But for now she's the number two and really the one to watch.

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