"We have started the process to consolidate our data centres to just eight strategic locations. This effort is planned to take us eight years, but we are working to pull this in sooner," wrote Davis.
"This initiative enables us to reduce costs, improve server and storage utilisation, create higher density and more energy-efficient data centres, and to keep pace with our rapid rate of innovation."
Intel is aiming to increase its use of virtualisation software to dramatically reduce the number of servers it uses, which currently stands at around 93,000.
Davis admitted that this could increase to as high as 250,000 if allowed to continue unchecked. It is a startling number considering that Intel employs around 90,000 people. The system deals with around 137TB of Wan traffic.
The new initiative breaks the company down into four distinct focuses, which Davis dubs Design Office Manufacturing Enterprise computing.
By focusing on each area independently the company hopes to reduce the number of data centres required to manage its business.
Davis added that Intel plans to use more multi-core systems to improve its use of virtualisation, with plans to run four operating system instances on each machine.
Intel hopes to complete the work by 2010, and claimed that the consolidation could result in savings of as much as US$1.8bn over the next seven years.
Other big names have also been taking similar steps to reduce data centre costs and their environmental impact.
HP has been reducing its 85 worldwide data centres into six US-based hubs, and IBM announced plans in August to cut its 3,900 servers down to 30.
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