US INTEL TO TAILOR PC'S FOR REGIONAL MARKETSMercuryNews.com | 08/01/2005 | Intel to tailor PCs for regional marketsIntel to tailor PCs for regional markets

CENTERS TO OPEN IN CHINA, INDIA, EGYPT AND BRAZIL

By Dean Takahashi

Mercury News


For Intel, the age of the one-size-fits-all personal computer is coming to an end. The chip maker is announcing today that it is redoubling its efforts to customize PCs for specific regional markets.

Bill Siu, general manager of the channel products group, is spearheading the charge by moving from Oregon to Shanghai. And the company is opening up four ``platform definition centers'' overseas so that it can study regional markets and design products for them.

The regional centers will be in Shanghai, China; Sao Paolo, Brazil; Bangalore, India; and Cairo, Egypt. The company will hire people with local knowledge of the markets to study consumer behavior and make suggestions for customized technology.

The centers are a major bet that Intel can continue to grow rapidly, by turning over every stone it can and expanding its sales efforts in emerging markets overseas even as mature markets such as the United States slow down. By 2009, Intel estimates that 44 percent of its market opportunity will be in emerging markets, compared with 38 percent today.

``This is recognition of the enormous growth potential we have in emerging markets,'' said Siu.

The results of Intel's overseas expansion are evident. In 1995, Intel had sales offices in only four emerging markets. Today it has more than 1,275 in emerging markets. A decade ago, it had 6,000 dealers who accounted for a third of its sales. But now Intel has more than 160,000 dealers dubbed channel partners around the world. In Shanghai, where Siu's group will be based, Intel already has 4,000 employees.

Siu still says that Intel will continue to design standard microprocessors and other chips that can be used anywhere in the world. But he notes that his Volkswagen van is configured to seat seven in its American model, but that the same van is configured to seat 15 in its Chinese version.

Intel already has a couple of examples that illustrate the benefits of customization. In the past year, Intel has introduced the Internet Cafe PC and the China Learning PC. The Internet Cafe PC is aimed at the cafes in Asia where hundreds of people come to borrow computer time to play games or communicate. The machines are configured so they can be easily maintained, run uniform software and have special protections against theft. The China Learning PC is a child's machine that can be used to learn to write Chinese characters and which can be locked into a mode where it can't play games or surf the Web.

Among the researchers who will coordinate research at the product definition centers is Tony Salvador, a trained psychologist working as an ethnographer, or someone who observes consumer behavior as closely as an anthropologist studies cultures.

``Only 10 percent of the planet has access to information technology,'' said Salvador. ``In places with large rural populations, you have different social networks, access to resources and physical infrastructure.''

He says the company can serve its customers better by treating each market as unique and tailoring products for it. In a phone interview from Bangalore, he said he couldn't find a used bicycle very easily. Then he noted how locals seemed to save and repair things over and over, including 25-year-old TV sets. For that kind of market, he said Intel might have to consider selling PCs that are easily repaired. In the United States, consumers don't think twice about tossing out a computer after five years.

``Price is one element,'' Salvador said. ``But you have to take the needs of people into account.''