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Intel has begun a global push to sell its computer processors in emerging markets as the world’s biggest chipmaker searches for fresh areas for growth.
Paul Otellini, chief executive, toured Latin America last week and unveiled a low-cost notebook computer in presentations in Argentina and Brazil. In Mexico, he introduced a cheap desktop computer that would be produced in partnership with local manufacturers.
In addition, Intel launched a rugged Community PC platform last week to serve villages in India and held talks in Ghana on introducing low-cost computers there.
Intel is describing the effort as its “Discover the PC” initiative “to make the benefits of PC technology more available to people in developing nations”.
It amounts to the biggest push to date by its Channel Products group, formed in January last year to address emerging markets. Intel also created Digital Home and Digital Health divisions at the same time, to explore opportunities in those areas and offset slowing growth in its main PC business.
“[Emerging markets] are a promising area for growth in terms of the numbers of people involved. The more technology we provide, the more people get engaged in technology and the more this takes off,” said Tom Beerman, Intel spokesman.
Martin Reynolds, Gartner analyst, says that, while the move is significant, Intel’s main challenge is persuading users in developed economies to keep replacing their PCs.
“Emerging markets are becoming important. Intel is preparing people there for a PC world; they’ve been pushing low-cost processors in developed markets for years and here they are also introducing them so they can get that next sale, when people get their second PC,” he says.
Intel has been seeding emerging markets with investments and education initiatives. It is spending $100m a year on education projects overseas and announced a $50m venture capital fund in Brazil last week.
It launched a $200m VC fund in China last year and has introduced an iCafé platform for easy upgrades of PCs in internet cafés there.
Intel is also taking advantage of lower costs of manufacturing in emerging markets. In February, it said it would build a testing and assembly plant in Vietnam, joining others in Costa Rica, China, Malaysia and the Philippines.