Intergraph exits PC and server business

Claiming that Intel Corp.’s actions have caused it “irreparable harm,” Intergraph Corp. said it is restructuring and plans to exit the PC and generic server business, a move that will cost 400 jobs worldwide.

The Huntsville, Ala, workstation and engineering design systems vendor said it will focus on expanding its high-end workstation, graphics accelerator, software and services businesses.

A lawsuit Intergraph brought against Intel is still pending, and alleges that Intel has unlawfully withheld information about its microprocessors that Intergraph needed to design the most up-to-date systems and deliver them to market in a timely fashion.

Recently Intergraph asked the judge in that case to force Intel to comply with a court order and give it access to the chip giant’s products and information pending the trial in U.S. District Court for Northern Ala.

Intergraph said that it would restructure the company into nine business units, each addressing “specific industries or markets in which Intergraph is an established leader or has long-term potential,” according to a company statement.

It seeks to stay in the high-end workstation and graphics accelerator businesses by partnering with companies that have complementary technology and sales channels, the statement said.

Intergraph’s revenue for fiscal year 1999 were slightly over US$1 billion. Of that, about US$600,000 came from its services and software, while about US$400,000 was derived from its hardware and hardware maintenance business, said Gene Wrobel, vice-president and treasurer.

“A good chunk of that (US$400,000) was from lower-end PC and servers,” Wrobel said, although he wasn’t immediately able to break the figures out exactly.

Integraph’s restructuring will result in a non-recurring charge to operations of approximately US$20 million for the quarter ending Sept. 30, 1999. The charge includes the cost of eliminating the 400 jobs, and revaluing the hardware inventory from its PC and generic server business.

The lines of business that Intergraph will focus on include geoengineering for government and transportation; systems for public safety and utilities; process and plant design, construction, and maintenance; federal systems; computer-aided engineering tools for electronics design; and photogrammetry.

Intergraph Computer Systems is being downsized and reorganized three units:

— Vizual Computing will include high-performance workstations and servers

— Intense3D will provide 3D graphics cards to computer vendors such as Compaq, Dell, Fujitsu, IBM, Intergraph Computer Systems, and Siemens

— IT Services will network services, professional system services, and Windows NT migration and expansion.