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otellini4.jpgIntel analyst meetings aren’t normally included in VentureBeat coverage. It is a 40-year-old company, after all. But Intel CEO Paul Otellini talked at a very high level in his presentation about the growth of the Internet itself. The numbers he presents are eye-opening and should give everyone, from start-ups to VCs, a better take on the opportunities at hand. I’m including some details from the webcast in this post. It’s funny compared to the last post on Electronic Arts and how it is the Death Star of video games. EA is a flea compared to Intel.

Intel doesn’t keep a lot of these stats itself. But when Otellini uses them, he gives them cred. First, he says that the entire chip industry is making 250 million transistors a year for every person on the planet. That will soon be billions, thanks to Moore’s Law.

The reason for this growth is the Internet, Otellini said. He says there are now one billion Internet users and 150 million web sites. The latter seems low, given how many blogs there are. The number of users adds up to 20 percent of the world population, he said, without citing his sources. He expects the number to climb to two billion in the coming years, thanks to the coming explosion of low-cost PCs, web-enabled phones, and mobile Internet devices.

Otellini said that Internet penetration in North America has reached 71 percent, while Africa as a region is at the bottom at 4.7 percent. Asia is 13 percent, and Latin America is 22 percent. What we’re doing on the Internet is constantly changing.

Last year, users watched 35 billion Internet videos. About 10 billion of those were in the month of December alone. And of those, three billion videos were watched on YouTube. There were 233 million visitors on YouTube that month and they watched a total of 22 billion minutes of video on the site during December. In 2017, Otellini says it will likely be 350 billion videos watched during the year. Advertising will follow the video, he said, and in the U.S., only 10 percent of advertising dollars are going to the Internet now.

The web is getting richer and more immersive, too. Online gaming and virtual worlds generated $5 billion in revenue in 2007 and that will double in five years, he said. That’s a 25 percent compound annual growth rate, and Otellini noted that the virtual worlds of the future will be far richer and more engaging than the visuals on Second Life now.

About 80 percent of kids ages 3 to 17 are participating online today in some fashion, and a third of those kids are on social networks, he said. There are 15 million teens, or 77 percent of the U.S. teen population, on social networks. That will grow to 82 percent in five years. But, surprisingly, 46.5 percent of adults are on social networks today and that will grow to 85 percent in 2011.

Gartner predicts that PC sales will grow from 300 million now to 400 million a year in a short time. Those are all the global numbers that Otellini talked about. In a second post, I’ll note where Intel’s expansion is happening.

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