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Technology Stocks : Intel Corporation (INTC)
INTC 36.85+1.6%3:59 PM EST

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To: Paul Fiondella who wrote (57478)6/8/1998 1:40:00 AM
From: Paul Engel  Read Replies (4) of 186894
 
Fiondella - Re: "Look Paul you are going around in circles"

How's this for the Intel Inside campaign.

Fresh off the press.

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techweb.com

With technology rapidly advancing, many VARs are up in arms
regarding the plethora of different processors available. For example, Jerry Duffy, owner of Abel Computer, a $4.5 million BYO VAR in San Carlos, Calif., sell mostly systems built with Intel chips because of brand awareness. He claims most of the corporate
buyers he deals with ask for Intel because "their reputations are on
the line." As for why his clients' corporate buyers mostly purchase
Intel processors, Duffy says, "It's a risk you don't have to take. It's
much easier to say 'I went with the market leader' and you don't have
to justify anything." For many IT managers and corporate buyers
seeking job security, it is easier to hide behind Intel's reputation than
to take risk on any of its competitors.


But, there are situations where low cost is the driving force of the
sale. JoAnn Garza, channel marketing manager at Cyrix, says the
MII processor delivers a performance equal to that of the Pentium II's
at half the cost. With the cost savings Garza suggests: "[VARs] could
add more peripherals [to the sale] to get a feature-rich solution."

"The Pentium II is really designed for the mid- to high-end PC
market," contends Cyrix's Swearingen. "It wasn't engineered to be in
the sub-$1000 market. They're trying to get to play there through cost
reductions and manufacturing efficiencies."

"The market is going through a maturation process. As the market
matures, it will subsegment," says Swearingen. He claims Cyrix
already has the upper hand on one of those subsegments, the
sub-$1,000 PC market, since the company already targets that
segment with a "specialized, focused engineering effort, while
[Intel's] is more general."

AMD and Cyrix have a tough battle ahead of them. Many VARs like
Duffy need more of an incentive to break away from the security Intel
provides than the slight monetary savings provided by either
underdog. VARs can debate until the cows come home which
processor offers the best performance, but apparently, marketing
clout is what's keeping Intel on top.


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Paul
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