Building for the future

Building for the future

During the recent Intel Solutions Summit (ISS), ARN's Nadia Cameron chatted with general manager of the chipmaker's sales and marketing group, Anand Chandrasekher, about the state of the market.

What key messages were you delivering to partners today?

Anand Chandrasekher (AC): Mostly I was talking about what's coming down the pipeline. We are launching 65 nanometre (nm)-based products for desktop, mobile and enterprise. Intel expects 65nm sales to exceed 90nm by the middle of this year. By the end of the year, dual-core processors will hopefully represent more than 80 per cent. When we do that, our product roadmap becomes much more competitive and we'll have leadership in every category. The combination of 65nm and new products, including Conroe and Woodcrest, will give us unprecedented advantage in the marketplace. I also talked about our platform plans and what we're doing with mobility, the home sector and the corporate environment. We're also giving partners a competitive outlook.

Competition from AMD has increased during the past two years and Intel hasn't met recent financial targets. It has been interesting to see Intel react to this threat.

AC: The market segment share threat has always existed. What happened in the second half of 2005 is that our capacity shortfalls and constraints made us unable to respond to customer needs. That cost us share. We have fixed a lot of those issues. Some were addressed by plans to move to 65nm. There was a six-month period where we didn't have 65nm, and didn't have enough 90nm products to go on. In Q1 we actually held share and made our revenue goals. We had adjusted these downward in the early March timeframe and we hit those on the nose. It doesn't make us any prouder, because we would rather have hit our earlier goals. But we didn't lose unit share in Q1. And that was our aim: utilise the growing capacity that was coming online, make appropriate changes in the product mix and hold share.

Intel has started marketing its competitive advantage over AMD. In the past, you've stayed away from direct comparisons. Why is this now a benefit?

AC: That is a policy change. Historically, we have not done comparisons with the competition. We started to change for a simple, fundamental reason: there is a lot of noise regarding what the competitor's products can do which isn't true. For example, what's the clock speed of an Athlon 3200? People expect it to be a 3.2GHz processor - which it isn't. So we chose to break that silence. We've started introducing reality-based marketing to show the products using industry standard benchmarks.

What does Intel's broader platform message mean and how can channel partners take advantage of it?

AC: The Pentium 4 is probably the last processor we introduced which was cool from a technology standpoint. This was really the point where the market stopped caring about clock speed. Up until then, we would launch a gigahertz processor and it would drive a mad rush into stores. That was the case in Asia certainly, but not so much in the US and Europe. It wasn't because the demand for performance had been satiated - far from it. Rather, the PC market had reached a point of maturity where buyers didn't care about technical details. As a result, our internal team moved into platforms that customers want to buy depending on what they want to do. When you look at the mobile platform, for example, there are a lot of factors people care about: size, weight, battery life, connectivity, performance. In order to address those issues, we had to look beyond processors. That drove the need for thinking about the platform and delivering Centrino. After two years convincing ourselves that was working, we reorganised the company to match the platforms push. We've since launched Viiv in January. We've also looked at what corporates want and identified manageability, security and virtualisation. We started investing in this platform at the same time as Centrino, but it's taken longer to develop the silicon. The first fruits of that [vPro] will come out mid-year.

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