INTEL CASE

BY GROUP 7
 introduction
• Intel teamed up with Rambus in 1996
• Intel making microprocessor
• Rambus making high speed memory chip
• Craig Barrett is intel chief executive

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 SALIENT FEATURE
• Intel as world’s largest chip manufacturer
• Intel good at producing faster microprocessor
But not at PC memory chip
• Rambus producing high speed memory chip
for PC
• Making of memory chips by Rombus were fast
and expensive
• Intel having money and marketing muscle
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 KEY PROBLEM AREA
• Over dependency of Intel microprocessor on
Rambus memory chip for technology
innovation.

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 SWOT ANALYSIS
STRENGTH WEAKNESS
•Intel capacity to produce high speed •Poor Rambus strategy
microprocessor •Expensive and difficult making of Rambus
•Rambus capacity to produce high speed memory chip
memory chip •Flaw in PC boards of Rambus
•Intel efficient money and marketing
muscle
•Favorable investment strategy in Samsung
and Micron Technology

OPPORTUNITY
•Intel may reap more benefit due to
investment in Micron and Samsung
•High profit margin due to its efficient
microprocessor
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THREAT
•Slowing PC market may hamper Intel's
profit
•Dependency on Rambus memory chip will
badly effect its Pentium 4 microprocessor
chips market along with existing
•Lack of support to Rambus from memory
chip producer and chip maker will make the
situation more worse
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 CURRENT SCENARIO
• Intel teamed up with Rambus in 1996
• Cancellation of Timna microprocessor
• Recall of more than 1m PC motherboard in
May
• Scrapping of about 1m PCs a year ago
• Intel paid $500m for 6% stake in Micron
technology
• Investment of $100m in Samsung
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 BCG MATRIX

Intel is at star position with high market growth and market share whereas Rambus
is at dog position with low market share and market growth

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 ANSOFF MODEL

The team of Intel and Rambus entered in the existing PC market with existing product
so is market penetration

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 DREK MODEL
• Intel is having leadership position with high
brand strength (i.e. differentiation and
relevance) and high brand stature (i.e. esteem
and knowledge)
• On the other hand Rambus is at
new/unfocused position due to low on brand
strength and brand strature

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 CORECOMPETENCY
• Fast and efficient manufacturer of
microprocessors with technology innovation

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 COMPETETIVE ADVANTAGE
• Investment in Micron and Samsung caused
appreciation in share price
• Better money and market capabilities

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 USP
• Technological innovation in making
microprocessors

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 DIFFERENTIATION
• High on technology innovation with right
investment strategies

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 POTTER’S MODEL

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 THE FIVE FORCES

• The threat of entry of new competitors (new entrants) is nil

due to slowing PC market
•
The threat of substitutes in the form of slower and cheaper
memory chip

• The bargaining power of buyers is more due to slowing PC

market
• The bargaining power of suppliers in increased due to
availability of cheaper types of memories
• The degree of rivalry between existing competitors is quite
obvious from the legal suit by Rambus on Hitachi and other
companies

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 FUTURE SCENERIO
• Intel may emerge as a high profit making
company with independent microprocessor
making and high share value
• Intel may incur losses due to slowing PC
market
• Rambus may incur more losses due to PC
makers favoring slower but cheaper types of
memories

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 SUGGESTION
• Intel should break off from Rambus due to
slowing PC market and expensive making of
memory chips
• Intel should reduce dependency on other
company for technological innovation

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 THANK U

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