In this presentation you will be knowing how Intel is successful in applying its strategies in markets.

1. Abhinay Bandaru
NIT Surat

2.  Founders: Gordon Moore, Robert Noyce
 Founded: July 18, 1968
 Headquarters: Santa Clara, California
 Largest Semi-Conductor Chipmaker based
on Revenue

3. The Interface Level

4. Market Segment
Intel
Facilitators
Buyers
Market
Segments
Suppliers
Competitors
- AMD
- Nvidia
- Texas Instruments Inc.
Market Share
PC => 79.3%
Mobile PC => 84.4 %

5. Product Mix
&
Industrial Marketing
Environment

6. Product Mix of INTEL
Processor Mobile Devices
Networking
Products
Intel-Atom-
Processor-Z3570
Value
Processor
Intel Core
Chipsets
Controllers
Adapters
Boards
Galileo
Edison
Intel-Atom-
Processor-Z3736F
Intel-Atom-
Processor-Z3530
Intel-Atom-
Processor-Z3736G
Intel Xeon
Intel Quark
Pentium
Celeron
Switches
Optics
Cables
Workstation
Server
Server
Chipset
PC Chipset
Server Products
RAID
Server board
I/O device

7. Outline
About Intel Corporation
Initial dominance and decline in DRAMs
Success in microprocessors
Becoming the builder of the Internet
0
1
2
3
Conclusions4

8. Department of Business Administration
College ofManagement
Intel in
DRAM Market

9. Source: Intel Case Exhibit 4 Volume Trends in DRAMs
Intel first
introduced 1K
DRAM (Lead)
TI and Mostek
had better design
and low cost.
Intel lost a full
generation to
Japanese (16K
vs. 64K)
Intel faced strong
price competition
from Japanese
Intel introduced
1-megabitDRAM
but has lost the
market
Intel exited DRAM market.1985
Intel produced the world’s first 1-kilobit DRAM, 1103 (Goldilocks strategy).1970
1 Initial dominance and decline in DRAMs

10. Henderson and Clark (1990)
Models of Innovation
Teece (1986)
Who profits from innovations?
As first mover, why failed in the end?
1. From radical innovation to incremental innovation…
2. Appropriability and Complementary…

11. Department of Business Administration
College ofManagement
“DRAM gave us fame,
but EPROM gave us riches.”
“We had microprocessors.”
---Andy Grove

12. Department of Business Administration
College ofManagement
Intel in
Microprocessors

13. 2 Success in microprocessors
1971: Intel 4004 1972: Intel 8008 1974: Intel 808 1978: Intel 8086 y 8088
1980 “Project Crush” + Design wins (Intel + IBM)
- IBM open standard
- Success in format war
- Being a free rider by design wins
1983 License control
- Restrict licenses to four company
- More design wins and more revenue
- Set up the industry standard
Platform building: x86
1982: Intel 80286
Second-source strategy
1985: Intel 80386 1989: Intel 80486
Sole-source strategy: becoming proprietary

14. 2 Success in microprocessors
TomDunlap,
senior vice
president
and general
counsel
Intel vs. AMD
“AMD’s products were big, ugly, and late.” (mid-1980)
“By the Pentium generation, AMD couldn’t get any trade secrets and couldn’t
copy our microcode, so our products developed quite differently.” (1995)
1991: AMD AMx86 1996: AMD K5 1996: AMD K6 y AMDK6-2 1999: AMD AthlonK7
(Classic y Thunderbird)
1993: Intel Pentium 1995: Intel Pentium Pro 1997: Intel Pentium II 1999: Intel Pentium III

15. Industrial Marketing
Strategies

17. Intel Inside Campaign (1991)
“To educate both the retail sales associates and the consumers about the
value of Intel microprocessors, and to explain to them the differences
between the microprocessors.”
Campaign Highlights:
Association with 200 OEM’s for Brand Recognition.
1st Trademark in the Electric Component Industry.
“Intel Inside” aka Quality & Reliable product for Buyers.
5 years later:
Intel’s link with World Market Leaders : COMPAQ, IBM !
Current Scenario:
 Brand value quantified at US$35 billion (Initial investment US$3.4
billion)

18. 1990 Success marketing: the “Red X” campaign specifically against AMD, and the
“Intel inside” end-user branding and advertising program to OEMs.
2 Success in microprocessors
Dennis Carter,
head of
corporate
marketing
Pentium bug: good response to product flaw and effective end user promotion
Architectural competition: RISC vs. CISC (Intel)
1994
1990-1995

19. 2 Success in microprocessors
DRAMs Microprocessors EPROMs
Patent ProtectionLaw V V
TradeSecrets V V V
Copyrights V
Trademarks V
Chip ProtectionAct V
Why has Intel been more successful inmicroprocessors?
Exhibit 6 Comparative Intellectual Property Considerations
Block
Run
Successful
Protecting
Strategies
Afuah (2003) Team Up
Intel+IBM
Design Wins
Intel sole-source
Block
Wintel PC + Intel inside
Fight against AMD
Team Up
Intel+HP
Strong
Proprietary
Invention of the
microprocessor
Emergence of Intel’s architecture
as the dominant design for PCs
Discontinuity from
RISC technology
Source: lecture slide

20. Intel in
Internet Market

21. The PC was at the center of computing during
the 1990s, but if you look at the next decade, it is
the Internet. The PC is still very important in the
Internet era, but there are lots of other things that
are important as well. People are going to access
the Net off their cell phones, and more cell
phones are sold today than PCs. Networking is
becoming more important, whether it’s in the
home, small business, or enterprise. If you want
to be involved in this new era, you have to look
for the new growth opportunities. That’s what we
are trying to do.
---Craig Barrett (1999)

22. Becoming the builder of the Internet3
Intel invested a large amount in such a short time, but not
matured enough for the new competition and new business.
However, it could have been worse if Intel did do so.
1. There was a recession and decreasing on world PC
microprocessor revenue (Exhibit 8).
2. The competition in new business was even stronger than
its core business (see Exhibit 10b).
3. Internally, Intel had a series of implementation errors
(p.15).
2001-2002 Intel shut down businesses ranging from Web hosting, network switching,
and network appliances to Intel consumer products. Barrett introduced a
back-to-basics program to achieve operational excellence.
Why? 新官上任三把火

23. Spring 1968 Robert Noyce and Gordon Moore left Fairchild Semiconductor to start
Intel with the venture capitalist Arthur Rock. Later Andy Grove joined
with a group of team from Fairchild.
Robert Noyce
1927-1990
Gordon Moore
1929-
Arthur Rock
1926-
Andy Grove
1936-
0 About Intel Corporation
1970s
DRAM
1980s
Microprocessor
Late-1990s
Internet

24. Becoming the builder of the Internet3
Microprocessor32-bit Celeron (1999)
32-bit Pentium (1997)
32-bit Xeon (1998)
64-bit Itanium (2001)
2002 Intel successfully pulled a generation ahead of AMD.
Intel had roughly 89% market segment share in mobile CPUs.
Do you think that Intel should maintain these strategy moves
in 2003? Yes, because the strategic position was right to the
future market and demand. The lost was temporary dueto
ill-management and unfocused diversification strategy.
Value-based lower prices
for higher volumes Mainstream High performance
32-bit Celeron
(1999)
32-bit Pentium
(1997)
32-bit Xeon
(1998)
64-bit Itanium
(2001)
Low-end consumer PC Mass PC
Low- and mid-range
corporate serverand
workstation
Corporate server
Client part Network connectivity Server/data farm
Convergence of computing and communications is the major
growth driver of the Internet, and we are in both.” – Craig Barrett

25. Conclusions5
Technology Strategies Maidique and Patch (1978)
DRAMs Microprocessors Internet
First-to-Market or
Leader Strategy
Intel Lead Intel Lead Protecting PC and
server platforms
Second-to-Market
or Fast Follower
Strategy Beat by Japanese Block
Establishing new
standards in
network and
communications
(WiFi)
Late-to-Market or
Cost Minimization
Strategy
No complimentary
assets Run and block ?
Market
Segmentation or
Specialist Strategy
Lost the market
Intel got the lead for
segmentation
(brand value)
?

26. Macro-Environment

27. 6 Major Factors affecting Intel

28. Economic Factors
Product demand
• Customer product needs
• Competitors pricing
• Tax rates
• Standard of living
• Market acceptance

29. Ecological Factors
Design semi-conductor keeping environment in mind
Responsible operations(supply chain)
Engaging employees to reduce impact
Recycling- Follows WEEE directive
Chip life extended up to 10 years

30. Physical Factors
 Obtaining the resources or products
 Subject to theft, loss or misuse of personal data and
components
 Risks of global operations
 Employees: Hardware and Software Engineers

31. Technological Factors
 Complex process of producing integrated circuits
 Response to technological and market developments
 Third party threats
 Process of Transition

32. Demographic Factors
Increasing
population
Age
discrimination
Booming IT
sector

33. Government Regulations on I.T. and
Hardware equipment

34. Conclusion:
Product, purchaser gets in exchange for his /her money
It can be offered to a market for attention, acquisition, use or
consumption and that might satisfy a want or need.
A product is a bundle of utilities consisting of various product features
and accompanying services.
So Intel also using the product knowledge proper and changing the
features and product according to the advance technology
requirement.