VIA becomes a dangerous challenger to Intel
Jiang Nan Monday 6/18/2001
VIA Technologies is demanding recognition, and market share in the Chinese mainland. In a bid to shrug off its low-profile image, the Taiwan-based chipmaker has spent over 20 million yuan this spring in erecting big outdoor advertisements all over Beijing's Zhongguancun, also known as China's Silicon Valley.
Its aim is no less than to cut into Intel's tight hold on the CPU (central processing unit) market in China. "In the year 2000 we had around 5 per cent of the market. We expect to double it this year," Frank Jeng, marketing director of VIA, was quoted as saying by a Beijing-based business journal.
VIA is making sure that this is no empty talk. So far, this Taipei-listed company, with revenues of US$1 billion last year, has invested around 700 million yuan into Beijing, Shanghai, Shenzhen, and Hangzhou to secure a foothold. On top of that, it plans to build a 20-storey R&D centre near Qinghua University to accommodate its 2,000 researchers. Currently it has only 1,600 worldwide employees. "The mainland is a strategic market for us. Sales here should account for one third of our total revenue within years," Jeng says. The company projects to double its revenue this year....
....With Intel and AMD slugging it out at the high end of the market, VIA targets the value end. "We are optimistic about the mid and low-end market. It has great growth potential," said Jeng.
It seems to be working. An unnamed Legend official told 21st Century Business Herald that Legend has always been thinking about more cooperation with VIA. At one time Legend was preparing to install its one product line only with VIA made CPUs, but was forced to put off because of pressure from Intel. "VIA's CPUs are quite cheap, and its performance is as good as Intel's Celeron (Intel's low-end product). Generally speaking [VIA chips] are more a bargain in terms of performance and price, and more suitable for low-price commercial computers." Legend reportedly gets a supply of 30,000 CPUs from VIA. Other domestic PC makers like Great Wall, Founder, and Qinghua Tongfang are all following suit.
Jeng views the mainland market as an excellent battlefield for VIA's CPU rise. While worldwide PC sales are predicted a growth of 13 per cent this year and 11 per cent next year by IDC, in the Chinese mainland it's projected at around 25-30 per cent over the next 2 years, with a big part concentrated in the mid and low-end market. Jeng is planning a US$5-6 million promotion in the mainland this year, four times more than last year.
Despite limitations set by Taiwan authorities on Taipei-listed companies - VIA by far enjoys the highest market capitalization in the Taiwan Stock Exchange - more investments are planned by VIA. "In the future, what we have here is VIA Group, rather than a single division," says Jeng.
7cworld.com
I'm not quite there yet, but I'll find the reference you were looking for. Note that VIA has to try to keep a low profile in the press to avoid Intel's mobster attacks. Intel's products may not be competitive, but it has become quite good at the intimidation racket, as described above. It would have been helpful if the article specified the time frame for its 30K figure. Per day? Per week? Per month?
Also not that the time frame of the article predates VIA's mass shipping of C3s and Intel's restriction of PIII.
Further note that, since the time of the article, estimates of world sales have gone negative, while estimates of Chinese sales have dropped to single digits - and VIA expected to pick up 5% of that market from Intel before Intel started cutting off the supply of Socket 370 chips.
Intel continues to focus on marketing, coercion, and deception rather than producing good products at reasonable prices. Rambus, Incompatible Architecture-64, dropping Socket 370, all reflect Intel's soviet socialist approach to the market. "Intel's planners will decide what you want as part of their 5 year plans" we are told. And any companies that don't comply find themselves targeted by Intel's gangster tactics: high demand Intel parts are allocated elsewhere, competitors are given special incentives, necessary development information is withheld.
But, so far, it doesn't seem to be working. Rambus has crashed and burned, taking a big chunk of Intel market share with it. If Intel provides the Socket 370 chips demanded by the Chinese market, large numbers of those chips will be diverted to the American and European markets mangling the strategy of forcing P4 on customers. If Intel doesn't provide socket 370 chips to the Chinese market, VIA will gladly fill those sockets, slashing Intel's share of the world's fastest (perhaps only) growing market.
We haven't yet seen what will happen when Incompatible Architecture-64 meets X86-64, but the past few years have seen AMD market share growing at a rate matching Moore's law (doubling every 18 months) and Incompatible Architecture-64 looks set to ensure that AMD's progress continues. |
