October 11, 2006 4:45 PM PDT
Dell Web site snubs Intel's Viiv
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Earlier this year Dell sold several PCs featuring a prominent logo and explanation of the Viiv technology on such systems as its vaunted XPS lineup. Dell's Dimension E520, XPS 210 and XPS 410 PCs still support Intel's Viiv program, a Dell representative said. These days, however, a shopper looking at those PCs on Dell's Web site has no way of knowing that those PCs come with Intel's Viiv technology until they receive the systems and notice the multicolored Viiv sticker on the box.
In a bitter twist, Dell and its gaming subsidiary Alienware introduced several new PCs Tuesday with Advanced Micro Devices' dual-core Athlon 64 X2 processors and highlighted its AMD Live software. AMD Live, like Intel's Viiv, is a poorly understood collection of hardware and software technology that is supposed to make it easier for consumers to put a PC at the heart of a home entertainment network. The names also rhyme.
An Intel representative said the company is currently encouraging partners to focus on the performance of its new Core 2 Duo processors ahead of so-called "platform" brands like Viiv and vPro. This is a departure from the strategy laid out by CEO Paul Otellini in January 2005. As then-president and chief operating officer, he reorganized the company into five divisions focused on creating platforms brands for different areas, like the digital home or the digital office. However, Hewlett-Packard and Gateway are still advertising Viiv prominently on their Web sites next to their home entertainment desktops.
Intel's Viiv brand, introduced with much fanfare, hasn't made an impact on the PC market the way its Centrino notebook technology did. The basic idea is the same as Centrino, in that Intel requires PC makers to use certain configurations of its products in exchange for marketing assistance. However, other partners have been slow to release networking devices certified under the Viiv program, and it took Intel several months after the launch of the brand to ship software enabling PCs to share content with wireless networking devices, portable media centers and televisions.
At the same time, there's no evidence that people are buying these PCs because of either Intel or AMD's entertainment brand, or that they are using their Viiv or AMD Live PCs to swap music, photos and videos around their homes. That would be like finding the Holy Grail of the PC industry's strategy for the living room.
Content deals for Viiv
Intel has started to put a little more color around Viiv in the form of exclusive content deals for Viiv PC owners. Fantasy football junkies can now watch National Football League games on their Viiv PCs with a window alongside the televised action featuring the latest disappointing point total from Seattle Seahawks quarterback Matt Hasselbeck, or the emergence of San Francisco 49ers running back Frank Gore.
The company also cut a deal with NBC to allow Viiv owners to download certain shows before they are shown on the network. A plan to release a Viiv set-top box with DirecTV is also in the works.
However, it's harder to develop that fabled "ecosystem" around a new technology without the active participation of the market leader. Dell was Intel's preferred PC partner for many years, getting first crack at new technologies and preferential marketing treatment at big Intel events. The once brotherly relationship between Intel and Dell has soured this year, as Dell finally caved into pressure from customers and announced plans to ship servers and desktop PCs based on AMD's chips. Thus ended the long-running exclusive relationship between Intel and Dell.
At last month's Intel Developer Forum, Dell executives and products were conspicuously absent. Other than a lone Dell notebook, other partners such as HP and Apple Computer were given the limelight. Apple, with small market share but ever-present buzz, was allowed to have Senior Vice President of Marketing Phil Schiller speak for several minutes in the middle of Intel CEO Paul Otellini's keynote describing new Apple products featuring Intel chips.
With Dell's tepid support for one of Intel's most prominent marketing campaigns this year, relations are sure to stay chilly heading into the important fall and winter holiday shopping season, the biggest period of the year for the PC industry. Nonetheless, a Dell representative said the company is looking into doing more Viiv-related promotion alongside its PCs in the future.
Don McDonald, the former head of Intel's Digital Home Group, was reassigned earlier this year in a management shakeup and replaced by former marketing chief Eric Kim. Kim has a huge challenge on his hands turning around the Viiv campaign, developed under his watch as Intel's marketing guru, without the clear support of the biggest PC vendor in the world.
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