2. Founders: Gordon Moore, Robert Noyce
Founded: July 18, 1968
Headquarters: Santa Clara, California
Largest Semi-Conductor Chipmaker based
on Revenue
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
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
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
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)
?
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
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.
Notes de l'éditeur
Good Morning ! Everyone
In today’s competitive market, if a firm wants to achieve success and survive, then Environment Scanning is one of the important activity that it needs to do.
Thereby We will portray the industrial environment of Intel Corp.
The interface level involves those key participants who immediately interface with an industrial firm to support in production, distribution and purchases of a firms goods and services.
There are 4 key participants – The Buyers,Suppliers,Faciltators and market segment
