Advanced assembly

While Intel manufactures cutting-edge CPUs, it is also investing heavily in building platforms aimed at emerging markets

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By  Stuart Wilson Published  May 29, 2005

Partner power|~|Nauthoa_Nass_200.jpg|~|Nassir Nauthoa, reseller channel manager for the Gulf and Saudi Arabia at Intel|~|Chip giant Intel was talking up the power of the platform at its recent Europe, Middle East and Africa (EMEA) summit for some 600-plus executives from its Intel Premier Provider (IPP) community. An action-packed schedule included presentations, roundtables and a visit to Intel's manufacturing operation in Ireland. There was also a special gala dinner at the famous Guinness factory in Dublin, prompting several delegates to compliment Intel on its ability to organise a 'party' in a brewery. Intel once again pulled out all the stops to get closer to its channel partners and ensure that the relationships being built are ‘win-win’ for both parties concerned. In total, some 15 IPPs from across the Middle East jumped on a plane heading for the Emerald Isle to hear the latest technology and channel announcements from Intel and visit its state-of-the-art fabrication facility in Dublin. As the local assembly market matures across the Middle East, expect more companies to be elevated to IPP status within the Intel channel programme. However, the exact criteria for qualification remains something of a mystery in the Middle East with Intel not prepared to specify, or even explicitly admit, that volume targets must be met. Nassir Nauthoa, reseller channel manager for the Gulf and Saudi Arabia, attempted to explain: “IPP status is for partners that are solution-oriented. They are capable of selling to SMBs and even corporates and we look for them to have staff with key accreditation from the likes of Cisco and Microsoft. These are the criteria: solution-focused with in-house technical expertise and the ability to provide support. There is no volume requirement as such.” ||**||Who wants to be an IPP?|~|tichelman_200.jpg|~|Maurits Tichelman, director of sales and distribution reseller channel operations EMEA at Intel|~|What is clear is that gaining IPP status remains a burning ambition for many assemblers in the market, given the advantages it offers in terms of the purchasing process from Intel’s authorised distributors and the increased benefits available through the Intel Inside marketing programme. Despite the ambiguous nature of the qualification criteria, assemblers are still fighting hard to gain IPP status. “We have a fairly good spread of IPPs across the region at present,” added Nauthoa. “We get approached by a lot of companies that want to be in the programme but as I said there are parameters to be met. We want to make sure the programme retains value.” The mystery attached to the process of gaining IPP status in the Middle East deepens when you compare it to the message emanating from Intel’s European executives. Maurits Tichelman, director of sales and distribution reseller channel operations EMEA at Intel, provided a clear view on the European qualification criteria: “First of all there is a certain revenue level that needs to be met. We want to invest in the customers that we think have the potential to be a key solution provider for their country. We also want them to have the capabilities to be a true technology leader.” “We have a European wide revenue requirement level. For legal reasons, we need to provide consistency in terms of the qualification criteria because we are giving additional benefits to one customer over another,” he added. At present, there appears to be a discord between the clarity of the IPP qualification procedure in Europe compared to the Middle East. Put simply, Intel needs to explain clearly what a local assembler in the Middle East has to do to gain IPP status. It is undoubtedly a more complex process than in Europe, but should still be based on clear and transparent guidelines as opposed to wishy-washy factors and subjective judgements. The process needs to be based on a clear set of criteria and applied consistently across the region. Without this transparency in the process, smaller assemblers — often stuck at Intel Product Integrator (IPI) level — will remain in the dark and continue to believe that a select few players are receiving extra benefits for no real reason. However, those still stuck at IPI level can take some solace from the fact that two of the Middle East attendees at Intel’s 2004 EMEA IPP summit, eMachine and DCS, were not present this year. ||**||The three Ps|~|brianharrison_200.jpg|~|Brian Harrison, VP sales and marketing group and co-general manager of Intel EMEA|~|Moving on to the technology aspect of the event, the push towards the platform sale as opposed to the pure processor was high on the agenda. This in itself was a tacit admission from Intel that the days of a speed hike every quarter driving customer demand for the latest high-specification processor are rapidly being consigned to history. For many customers, the incremental difference in performance speed actually means very little to them, so you need to give them something else that will persuade them that an upgrade makes sense. Where speed was once king, Intel is now convinced the three Ps are set to take over: price, performance and power. And when Intel says power, it is referring to power consumption, heat emission and cooling requirements — key concerns for assemblers of servers and notebooks where physical space may be at a premium in the design. The push towards the three Ps is a driving force behind product evolution at Intel. The vendor has become much more than a CPU vendor, and building powerful platform solutions that leverage its wider product portfolio is one chosen method for Intel to extend its channel footprint. As the desktop sector waves bye-bye to boring beige boxes and ushers in a new era of cool, sleek and trendy form factors, the ability to source a tried and tested components platform that offers reliability and new design options will become crucial. Progress is already being made in this direction. At last year’s EMEA IPP summit, Intel’s mock-up of the digital home of the future included a bog-standard desktop PC sitting in the living room acting as the home entertainment server that fed other devices around the home using a wireless network. This year, the bog-standard desktop PC was nowhere to be seen in the living room, having been replaced by a virtually silent specifically designed media centre. Intel has played a key role in the development of this device, which looks more like a DVD player than a PC, and will now start working with its channel partners to bring the product to market under various different brand names. ||**||iCafé concept PC|~|Willy_Agatstein_200.jpg|~|Willy Agatstein, VP channel platforms group and general manager reseller products group at Intel worldwide|~|When the talk turns to the digital home, the natural reaction from those working in developing markets or areas where spending power is limited and internet uptake remains slow tends to be, ‘great concept, come back in ten years when we’re finally ready for it’. While the digital home undoubtedly remains a pivotal go-to-market message for Intel in developed markets around the world, the vendor giant is also pulling out all the stops to create the platforms and products that will be uniquely relevant to emerging markets as well. One such effort has been the development of the iCafé concept PC in China with Intel playing a key role in this programme. Designed specifically for internet cafés, or environments where machines have multiple users, the iCafé PC comes with manageability software that allows an administrator to restore the original settings of the machine quickly and efficiently. In an internet café, the combination of hardware and software allows the machine to be reset centrally as soon as each user logs off. This concept — already successful in China — is now being piloted in Turkey with a wider Middle East rollout also under long-term consideration. Intel is also looking closely at the type of standardised PC platform and machine that will be most suitable for areas such as rural India. “We will look at how well the scheme works in Turkey and collect feedback. The initial response has been very positive and the plan is definitely to expand it to other countries. Another obvious country for us to look at is Egypt,” added Tichelman. Intel’s quest to develop appropriate platforms for developing markets is epitomised by its decision to locate a channel platforms group definition centre in Cairo. The move forms part of Intel’s commitment to investment in the Middle East and Africa region. “We intend to more than double our sales and marketing resources in the Middle East during 2005,” said Brian Harrison, VP sales and marketing group and co-general manager of Intel EMEA. “In addition to that we have just announced that we are putting in a software solutions group into the Middle East as well as the channel platforms group definition centre that will define new products and platforms that are uniquely suited to the needs of the Arab market.” ||**||Emerging platforms|~|jimnoble_200.jpg|~|Jim Noble, mobility executive at Intel|~|Willy Agatstein, VP channel platforms group and general manager reseller products group at Intel worldwide, will play a key role in the development of platforms and products for emerging markets. “My new job involves a couple of key challenges,” said Agatstein. “The first is to understand the local markets, find the products that work in emerging markets and deliver them through the channel to really fulfil needs that were not being met before.” Besides the iCafé concept, Intel is also involved in a project to develop PCs for rural communities in emerging markets. Agatstein explains: “One project we are working on now is the Indian rural PC, which by the way is not just intended for India and not just for rural areas. This will be a platform targeted at areas where electricity supply is intermittent. We are creating a system with built-in power management capabilities as well as unique dust protection characteristics.” “Beyond that we are looking at PCs that can be shared by many people — a community PC. These are the ones we are working on right now. If we could come up with these ideas out of Sacramento we would. However, we have realised that we need to put people around the world to develop these platforms and draw on our worldwide presence and insight into the needs of the local markets,” he added. For Intel, advanced assembly does not just mean pushing the latest and greatest technologies to market; it also means developing and defining the appropriate technology platforms for emerging markets with the Middle East and Africa region poised to play a pivotal role in this process. The company is also doing its level best to encourage the development of local assemblers in emerging markets such as the Middle East and Africa. In this respect, Intel is also keen to make sure local assemblers have the products and support needed to carve out a niche not only in the desktop arena, but also in the notebook and server space. Jim Noble, an Intel mobility executive, reckons that there is plenty of room for the channel to add value in the notebook sector. “The local notebook integrator has the potential to become a trusted advisor in the SMB, education and even government space. Mobility opens up new opportunities to add value in the business environment and local integrators can address this,” he concluded. ||**||

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