Computer chip maker Intel is looking to cut costs by $US1 billion,
according to chief executive Paul Otellini.
The move comes after Intel last reported net first-quarter profit fell 38 per cent from a year ago to $US1.3 billion on sluggish demand for PC chips... The company has taken knocks this year as smaller rival AMD has grabbed market share.
Perhaps AMD hasn't been going around insulting its customers on television, as Intel has recently in commercials announcing their expansion into supplying the Macintosh platform.
In the ad, workers dressed like NASA 'clean room' engineers assembling a satellite delicately handle the product and watch its progress to some looming conclusion while the voiceover bemoans:
"For years, the Intel chip has been stuck inside boring little boxes doing boring little tasks."
And boasts that putting them in Macs will set them free to be creative and exciting:
"Imagine the possibilities..."
Indeed, the possibility is that the many people who perform highly creative tasks everyday using PCs that are 'Intel Inside' will be insulted.
Taking The LeadWhile Macintosh computers held the creative edge for many years and their pre-eminence in the early days of desktop publishing and computerised graphic design led to them having a virtual stranglehold on the printing industry even today, the past decade has seen the humble PC grow from a word processor to a creative giant.
In the mid to late 1990s, an army of young internet programmers learned their emerging craft on PCs because what they were doing was not so dependent at that time on using specific programs (the best of which were usually Mac-based) as it was on simply opening any text editor and writing code. And one could do that as well on a cheap PC as on a comparitively expensive Mac.
New software makers and programs emerging to cater to this group went where they had cut their teeth and their customer-base lay - in PCs - and today equally good software is available on both platforms for the complete range of design, from on-line to print.
Which brings us back to Intel, whose 'Intel Inside' campaign and logo stands as one of the most successful brand awareness promotions of the late 20th century. It has led to a generation of consumers who couldn't care less whether their computer's hard drive is Seagate or Shenzhen Yagu but who ask the Harvey Norman salesperson 'Is the chip Intel?'
Unfortunately for Intel, rival AMD beat them to market last year with a key technology that puts two processing engines on a single chip and Intel is now losing market share.
They won't get it back by sneering at the people who purchase their product.
Guilt By AssociationA flaw in the Intel campaign has also emerged recently in TVCs for Asus notebook computers with wireless TV capability. I'm talking about the ad in which a young wife, apparently doing the housework in the unlikely attire of a designer dress and high heels, demands assistance from her husband who is watching soccer on his laptop.
Unable to get his attention and believing him to be watching the television, she pulls the plug and is frustrated to find he is actually viewing the match on his laptop. Nonetheless, hubby carries the computer, eyes glued to the screen, to the backdoor where a bag of garbage awaits and kicks it without looking but with pinpoint accuracy into the bin across the yard.
Cutaway sequences tell us of the computer's attributes including Intel technology before a denouement in which the wife again calls 'Honey, I need some help' while placing a weight-lifting dumbbell in the doorway, hinting at the painful surprise hubby will get this time when he punts without looking.
Frankly, it's a mean, divisive ad that actually sends a negative subliminal message to males, who are, ironically, the intended consumers.
Bad move by Asus but it also stains Intel with guilt by association. If they want to hold onto market share, they don't just need to think about who their customers are but they also might like to consider not hanging around in bad company.
