The cost of setting up e-business systems at Intel blew out by around 40 per cent.
Intel's senior vice-president, Sean Maloney, described the cost of Intel's e-business strategy - moving its multi-billion dollar inventory fax order system online - as a "moving target".
He said the cost of the company's decision two years ago to shift its business-to-business operations to the Internet was between 30 and 40 per cent above expectations.
Maloney said a lack of e-commerce experience and slow demand for online services from Intel's clients - a majority of which did not initially have e-commerce capabilities - led to the budget blowout.
Maloney also pointed to the reliability, or lack thereof, of the Internet meant a lot of businesses had blamed Intel for problems out of its control.
As a result, the company has been working with world governments to reduce Internet congestion and increase the capacity of the Internet backbone.
Within the next six months Maloney said he expects all of Intel's customers to deal with the company online. He also pointed out that, to date, the company's online business had generated between $US10 and $US12 billion.