Wednesday, December 13th 2017

"Intel inside" Campaign Funds Cut, Might Bring Higher Pricing to End Users

Intel has decided to rollback investment - read, funding - for its "Intel inside" marketing campaign, which has been with us since 1991. The "Intel inside" campaign is one where Intel has been offering OEMs and system integrators some amount of compensation and marketing funding for their Intel-based products, and is aimed at helping OEMs and channel partners drive PC sales growth. However, if CRN's report is right, Intel is looking towards cutting funding for this program by 40% to 60%.

OEMs have been including Intel's "Intel inside" funding as part of their annual marketing budgets, and the reduction of this funding from Intel can go one of two ways: manufacturers reduce marketing budget, or keep the same budget, but pass on the increased expenses towards consumers. For companies, the second option is likelier to be true, simply because marketing plays such a prominent role in company's visibility in the usually crowded markets.
"We're hearing that major cuts are coming throughout Intel's marketing and channel programs," a top executive for a major Intel partner who has been informed of the cuts told CRN. "The marketing funds have been moved to other groups within Intel that aren't channel-specific or PC-centric. The funds will now go towards driving the business in data center, giving more to the data side of the house instead of compute. A lot of dollars are moving to other areas or kept in house to improve Intel's profit and margins." Whether Intel needs this added funding to be added to its bottom line, however, is always a matter up to debate.
Intel spokespersons have confirmed this to CRN, saying that these changes are intended to "help customers more efficiently and effectively market with Intel, while helping us market with more precision in alignment with Intel's business priorities." That's all well and good, but the snarkiest among us might ask themselves whether or not this stems from the fact that some Intel products now have AMD inside as well.(Too soon?) Source: CRN
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12 Comments on "Intel inside" Campaign Funds Cut, Might Bring Higher Pricing to End Users

#1
Rauelius
Bad timing with Ryzen 2xxx on the horizon.
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#2
yogurt_21
Wat?

So intel paid for general budgetary marketing as long as it met certain parameters? That doesn't seem modern day sustainable. "Resell our products and we'll pay for your marketing" How big is the channel that uses this? How much are they paying. I mean sure it likely made Intel tons of money over the years, but now the industry is in decline while still being huge. I'm not sure Intel's getting a huge ROI out of that.

seems like it would be cheaper to provide stock marketing materials that can be customized for brand to the partners instead.
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#3
Vya Domus
Intel has decided to rollback investment - read, funding - for its "Intel inside" marketing campaign, which has been with us since 1991. The "Intel inside" campaign is one where Intel has been offering OEMs and system integrators some amount of compensation and marketing funding for their Intel-based products, and is aimed at helping OEMs and channel partners drive PC sales growth.
Funny , aren't those actually the billions they paid OEMs to avoid AMD like the plague in an attempt to bury them for good ? It didn't work though , AMD is still around. It's only natural they are going to cut those "funds" after all.
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#4
Darmok N Jalad
yogurt_21 said:
Wat?

So intel paid for general budgetary marketing as long as it met certain parameters? That doesn't seem modern day sustainable. "Resell our products and we'll pay for your marketing" How big is the channel that uses this? How much are they paying. I mean sure it likely made Intel tons of money over the years, but now the industry is in decline while still being huge. I'm not sure Intel's getting a huge ROI out of that.

seems like it would be cheaper to provide stock marketing materials that can be customized for brand to the partners instead.
Yeah, any PC commercial you watch that mentions Intel and/or ends with the “Intel inside” jingle was at least partially paid for by Intel. Once you know that, you now have a really good idea of just how many PC commercials were paid in part by Intel. I imagine it will still continue even with the budget cuts, as it’s still at least a partial subsidy of the marketing.
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#5
TheGuruStud
Vya Domus said:
Funny , aren't those the billions they paid OEMs to avoid AMD like the plague in an attempt to bury them for good ? It didn't work though , AMD is still around. It's only natural they are going to cut those "funds" after all.
It really just shows how useless, corrupt and ineffective the legal system is when it comes to big biz. Intel is STILL bribing them.
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#6
HimymCZe
... so for Intel saving money means more expensive product?
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#7
hellrazor
Wow, Intel is going full-auto on their foot today.
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#8
HopelesslyFaithful
TheGuruStud said:
It really just shows how useless, corrupt and ineffective the legal system is when it comes to big biz. Intel is STILL bribing them.
:slap: millennials. Joint marketing is not bribery :banghead::kookoo:

HimymCZe said:
... so for Intel saving money means more expensive product?
yea that was my thought. OP doesn't comprehend how things work. If anything this helps people who buy CPUs direct....if they just dont pocket the savings ;)
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#9
Shamalamadingdong
HimymCZe said:
... so for Intel saving money means more expensive product?
I think the point was that if Intel doesn't subsidize the Lenovo or Acer advertisement you're watching, then the money will come from you the consumer. However one would hope it evens out through Intel getting less money from OEMs (eg. reduced CPU price) so OEMs can put that towards their own advertisement. Unfortunately it will probably end up like Intel saving money on advertisement but charging OEMs the same so we'll foot the bill.
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#10
Darmok N Jalad
Shamalamadingdong said:
I think the point was that if Intel doesn't subsidize the Lenovo or Acer advertisement you're watching, then the money will come from you the consumer. However one would hope it evens out through Intel getting less money from OEMs (eg. reduced CPU price) so OEMs can put that towards their own advertisement. Unfortunately it will probably end up like Intel saving money on advertisement but charging OEMs the same so we'll foot the bill.
I think Intel has far more overhead than its rivals, and this joint ad campaign was low hanging fruit to trim overhead. In other words, OEMs get no cost reductions on Intel products, so any advertising cost-sharing loss means either fewer ads, or higher PC costs.

One variable to consider is that 8th gen products saw significant performance improvements from increased core counts, so it’s possible OEMs could get by with more i3 and i5 products and recover cost savings there. It almost seems like Intel was not prepared to add cores this soon, especially since they desperately need a node shrink to keep reducing die sizes.
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#11
Basard
I like having the FX sticker on my case, it makes it look like a stock car or something, lol.... no, seriously, I do. I think intel should just "force" them to give you a cool sticker that you can put where you please.
Posted on Reply
#12
R-T-B
HopelesslyFaithful said:
:slap: millennials. Joint marketing is not bribery :banghead::kookoo:
People who blame "millenials" for everything... :banghead:

It does incentivize them to include intel in their product, though "bribe" is indeed a bit harsh.
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