Paul and Thread - Article: Intel Getting Inside Consumer Appliances
zdnet.com
Intel getting inside consumer apps
If the PC chip giant's strategy works, an Intel Internet phone could be on your kitchen counter in the near future.
By Robert Lemos, ZDNet News
January 4, 2000 11:10 PM PT
Intel Corp. doesn't just want to just be inside your computer -- the chip maker is now looking at creating a host of information appliances, ranging from smart Internet phones to Web tablets.
"We imagine a whole family of consumer devices," said Claude Leglise, vice president and general manager of Intel's home products group. "There will be big ones and little ones. Some will be like a phone. Others will have a CRT."
On Wednesday, Intel (Nasdaq: INTC) is expected to announce a new strategy aimed -- not at PCs -- but at simpler consumer information appliances.
Eighteen months in the making, the strategy is aimed at providing such appliances to large service providers -- such as telecommunications firms and Internet companies -- who will then sell, rent, or give away the devices to consumers, some as early as this summer.
Cell phones 'a good model'
"A good model is what is happening with cell phones," said Leglise, pointing out that such phones are frequently co-branded and can be subsidized by the service provider. "That's really the model we have with these Web appliances."
If successful, the company could be guaranteeing its place as a leader in the information-technology marketplace, said Rob Enderle, vice president of desktop and mobile technology for Giga Information Group.
"In this case, it is not a case of trying to expand, it's more that they want to make sure that they are not frozen out of the market," he said. "Appliances are coming home. This is a way for Intel to make sure that the manufacturers are not using other companies' processors."
Intel's advantage may be its traditional hands-on approach with its corporate customers: The company will be offering manufacturers of appliances and service providers a bevy of building blocks to help them create devices and applications for consumers.
Already, Intel has signed a deal with Telcordia Technologies Inc. (formerly Bellcore) to provide the telecommunications technology for the new appliances.
Lucent a partner
The final facet of the strategy is building the infrastructure to allow service providers to manage the devices remotely. Intel has teamed up with Lucent Technologies Inc. (NYSE: LU) to create a unified messaging system that could replace answering machines with a system that shows who called and when on a screen. Returning calls would be as easy as touching the screen.
"(Our customers) want to make sure that the appliance is always working," said Leglise. "We are talking about appliances that can handle the Internet. We have given them the ability to upgrade the appliances remotely. And they want to be able to offer a variety of services to fit every consumer."
Other partners include NEC's BiGlobe in Japan and LaSer-Galeries Lafayette Group in France, both of which plan to deploy Intel information terminals in homes starting this summer.
Moreover, while the PC chip giant eschews Larry Ellison's phraseology, Intel even believes the network-computer-like appliances could be big. With at least one appliance that uses a monitor and another that uses a flat-panel display,
"We want to go into homes that don't have a computer," said Leglise. "Overseas is certainly a huge opportunity for us in that respect."
In the end, however, the shift towards an information appliance manufacturer could be short-lived, said Ederle. "The issue for them is that they have a fixed set of resources. If they can get the Sonys and the RCAs to pick up their products, they will do better -- and sell more -- than just producing their own."
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