INTEL CASE
INTEL CASE
BY GROUP 7
introduction
introduction
•
• Intel teamed up with Rambus in 1996Intel teamed up with Rambus in 1996 •
• Intel making microprocesIntel making microprocessorsor •
• Rambus making high Rambus making high speed memoryspeed memory
chip chip
•
SALIENT FEATURE
SALIENT FEATURE
•
• Intel as world’s largest chipIntel as world’s largest chip
manufacturer manufacturer
•
• Intel good at producing fasterIntel good at producing faster
microprocessor microprocessor
But not at PC memory chip But not at PC memory chip
•
• Rambus producing high speedRambus producing high speed
memory chip for PC memory chip for PC
•
• Making of memory chips by RombusMaking of memory chips by Rombus
were
KEY PROBLEM AREA
KEY PROBLEM AREA
•
• Over dependency of IntelOver dependency of Intel
microproce
microprocessor on ssor on Rambus memoryRambus memory chip for technology innovation.
SWOT ANALYSIS
SWOT ANALYSIS
STRENGTH
STRENGTH
•
•Intel capacity to produce highIntel capacity to produce high
speed microprocessor
speed microprocessor •
•Rambus capacity to produce highRambus capacity to produce high
speed memory chip
speed memory chip •
•Intel Intel efficient efficient money money andand
marketing muscle
marketing muscle •
•Favorable investment strategy inFavorable investment strategy in
Samsung and Micron Technology
Samsung and Micron Technology
WEAKNESS
WEAKNESS
•
•Poor Rambus strategyPoor Rambus strategy
•
•Expensive and difficult making of Expensive and difficult making of
Rambus memory chip
Rambus memory chip •
•Flaw in PC boards of RambusFlaw in PC boards of Rambus
OPPORTUNITY OPPORTUNITY
•
•Intel may reap more benefit due toIntel may reap more benefit due to
investment in Micron and Samsung investment in Micron and Samsung
•
•High profit margin due to itsHigh profit margin due to its
efficient
efficient microprocemicroprocessorssor
THREAT THREAT
•
•Slowing PC market may hamperSlowing PC market may hamper
Intel's profit Intel's profit
•
•Dependency on Rambus memoryDependency on Rambus memory
chip will badly effect its Pentium 4 chip will badly effect its Pentium 4 microprocessor chips market along microprocessor chips market along with existing
with existing
•
•Lack of support to Lack of support to Rambus fromRambus from
memory chip producer and chip memory chip producer and chip
maker will make the situation more maker will make the situation more
CURRENT SCENARIO
CURRENT SCENARIO
•
• Intel teamed up with Rambus in 1996Intel teamed up with Rambus in 1996 •
• Cancellation of Timna Cancellation of Timna microprocemicroprocessorssor •
• Recall of more than 1m PCRecall of more than 1m PC
motherboard in May motherboard in May
•
• Scrapping of about 1m PCs a yearScrapping of about 1m PCs a year
ago ago
•
• Intel paid $500m for 6% stake inIntel paid $500m for 6% stake in
Micron technology Micron technology
•
BCG MATRIX
BCG MATRIX
Intel is at
Intel is at star position with high market growth and market sharestar position with high market growth and market share whereas Rambus is at dog position with low market share and
whereas Rambus is at dog position with low market share and market growth
ANSOFF MODEL
ANSOFF MODEL
The team of Intel
The team of Intel and Rambus entered in the existing PC market withand Rambus entered in the existing PC market with existing product so is market penetration
DREK MODEL
DREK MODEL
•
• Intel is having leadership positionIntel is having leadership position
with high brand strength (i.e. with high brand strength (i.e.
differentiation and relevance) and differentiation and relevance) and high brand stature (i.e. esteem and high brand stature (i.e. esteem and knowledge)
knowledge)
•
• On the other hand Rambus is atOn the other hand Rambus is at
new/unfocused positi
new/unfocused position due to on due to lowlow
on brand strength and brand strature on brand strength and brand strature
CORECOMPETENCY
CORECOMPETENCY
•
• Fast and efficient manufacturer of Fast and efficient manufacturer of
microproce
microprocessors with ssors with technologytechnology innovation
COMPETETIVE ADVANTAGE
COMPETETIVE ADVANTAGE
•
• Investment in Micron and SamsungInvestment in Micron and Samsung
caused appreciation in share price caused appreciation in share price
•
• Better money and marketBetter money and market
capabilities capabilities
USP
USP
•
• Technological innovation in making Technological innovation in making
microprocessors microprocessors
DIFFERENTIATION
DIFFERENTIATION
•
• High on technology innovation withHigh on technology innovation with
right investment strategies right investment strategies
POTTER’S MODEL
POTTER’S MODEL
THE FIVE FORCES
THE FIVE FORCES
•
• The threat of entry of new competitors (new The threat of entry of new competitors (new
entrants) is nil due to slowing PC market entrants) is nil due to slowing PC market
• •
The threat of substitutes in the form of slower The threat of substitutes in the form of slower and cheaper memory chip
and cheaper memory chip
•
• The bargaining power of buyers is more due to The bargaining power of buyers is more due to
slowing PC market slowing PC market
•
• The The bargaining bargaining power power of of suppliers suppliers in in increasedincreased
due to availability of cheaper t
due to availability of cheaper types of memoriesypes of memories
•
• The degree of rivalry between existing The degree of rivalry between existing
competitors is quite obvious from the legal suit competitors is quite obvious from the legal suit by Rambus on Hitachi and other companies
FUTURE SCENERIO
FUTURE SCENERIO
•
• Intel may emerge as a high profitIntel may emerge as a high profit
making company with independent making company with independent microproce
microprocessor making and ssor making and highhigh share value
share value
•
• Intel may incur losses due to slowingIntel may incur losses due to slowing
PC market PC market
•
• Rambus may incur more losses dueRambus may incur more losses due
to PC makers favoring slower but to PC makers favoring slower but cheaper types of memories
SUGGESTION
SUGGESTION
•
• Intel should break off from RambusIntel should break off from Rambus
due to slowing PC market and due to slowing PC market and
expensive making of memory chips expensive making of memory chips
•
• Intel should reduce dependency onIntel should reduce dependency on
other company for
other company for technologicaltechnological innovation
