Intel Case Study

INTEL

Intel has been a giant in the microprocessor industry for years. Ask a random person on the street if they have heard of Centrino or Pentium, and I am sure you will get the same answer of yes. Intel spent much of the early nineties being one of the top ten recognizable names, along with Nike and McDonalds. Intel was launched in 1968 and focused on semiconductor memory products. The company then introduced its first microprocessor for calculators in 1971.

It was in the mid 1980s that Intel focused on the ever growing market of computers and especially PCs. They began to produce microprocessors specifically designed for computers, laptops, and server computer markets in the mid to late 1990s. This was a highly successful and profitable time for Intel. They were producing more microprocessors in a day than most competition was producing in a year.

In 2000, however, Intel faced some major competition from new microprocessor vendors such as AMD. Both Gateway and HP chose to use AMD processors. With its microprocessor business coming under pressure, it was obvious that Intel had to diversify into other product categories. Intel announced its Web devices strategy, a new market that follows diversification into Web-hosting, communication chips and server hardware manufacturing business.

Intel’s consumer Web appliance product strategy was designed to provide three major components--appliance management capabilities, services package building blocks, and a family of Intel-branded Web appliances designed for accessing the Internet. These were planned to be used by telecom operators and service providers, who would offer them to consumers. Intel also set their focus on personal electronics and the healthcare industry.

The economy is constantly changing, along with people’s wants and needs. I believe it is very important to change and develop along with everything else. It was not just Intel, but all high-tech companies that have been affected by this shifting. Intel would be suicidal if they chose to sit back and continue doing the same thing while everyone and everything around them is moving forward. It is important to expand intelligently though. After CEO Paul Ottellini’s dramatic plan was put into action, all did not follow according to plans. Of the 20,000 new employees hired, 10,500 were let go in 2006 due to falling profits by July 2006.

Even if the plan didn’t work out as Intel may have thought it would. Ottellini is not discouraged. In a recent interview, Paul Ottellini reveals the low-cost Atom processor is Intel’s bid to supply the processing engines that will help vastly expand the reach of the Internet beyond personal computers.