Intel case

 Analyzing Intel’s Strategy To Sustain Competition Competition 1968-2003 1968-2003 Using The Tetra Threat Framework 

CASE ANALYSIS In the year 2002, there was a downturn in the semiconductor industry, so to sustain the market Intel’s CEO, Craig Barrett decided that it is only innovation that can help Intel sustain the

competition in the Industry. So Intel invested more in R&D and manufacturing and also in networking and communication (the upcoming market then). Intel first started with semiconductor memory memory device that repl aced magnetic core memory. It st

tried many designs and then worked with MOS and then created World’s 1 DRAM.

To save the designs Intel had to go for sharing the patents as a chip manufacturing company company had to go for 100 of patents which were very expensive. Intel produced DRAMs but used to lose the market to the worthy Competitors especially Japanese. Then the innovated EPROM which was a huge success and for a long time they had no competitors. But again lost the war, in price competition with the Japanese. Then in 1971, Intel chips were used in the Altair Comp kit then competing with those of Motorola in Apple. Then to win over the market Intel came up with 80386 chips. And to be the sole producer they tried to convince IBM, but they refused and Compaq took over the IBMs market. Then came up

Intel Analysis by PGRM-18

with the 486 chip, which brought AMD and Intel in disputes. Which then led to the decision by Intel that AMD can sell only 486 and no more future innovations of Intel? Then came the era of RISC and CISC, Intel worked on CISC architecture but then had to copy some ideas from RISC to sustain the market and ease the users. In 2000, Intel tried to work on the Marketing strategy, Intel Inside Stickers, It was then a hit. IBM refused to put the stickers as there was less willingness to pay for the brand.

Intel also sold half, pre built pc to many companies and also followed premium pricing at the launch stage (for a yr) and then reduced the prices by 50%, to handle the demand and supply constraints. They had higher power on suppliers and pushed them to supply products fast. It also paid money to game designers to use its instructions. It then also invested in various businesses that could help Intel. Entering in the new world of networking and laptops, Intel introduced chips in e very price range to fight the competitors. It focused more on performance for premium payers by improving the battery life and reducing the heating problems.

Intel Analysis by PGRM-18

TETRA THREAT FRAMWORK Threat of Imitation: 

Maintained long term relationship with its complementors like Microsoft.

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R&D-Innovations and upgrading its microprocessors made it difficult for its Competitors to copy and helped Intel to sustain.

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It also got in contract with IBM for 8088

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Due to rapidly changing technology , Intel didn’t invest in patents but then used IPR protections for its technology.

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Intel introduced more than 2000 designs which were not economical to imitate.

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Microsoft helped Intel to create a loyal customer base .

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Intel had strong relations with tits suppliers and also went for dual sourcing at times.

Threat of Substitution: 

In the CISC technology Intel after straddling , decided not to respond to its Competitors.

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Intel made it difficult for its competitors to achieve high compatibility as Intel did because Intel always leapfrogged before its competitors could.

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Intel produced innovative products and thus could charge premium prices at the introduction stage and then reduced the prices.

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After entering in the World of Internet, the competitor’s complementors also became Intel’s complementors, due to innovative products.

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Intel always fought hard with its Competitors.

Hold-up 

Intel had strong relations with tits suppliers and also went for dual sourcing at times. Entered in contracts with suppliers for mass production of critical parts.

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Strong trust relationship with complementors like Windows.

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Marketing of Intel Inside rose the value for the complementors, and thus forced other complementors to use Intel’s products.

Intel Analysis by PGRM-18

Intel Analysis by PGRM-18