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Intel's Pentium M sales take off in US

Intel's Pentium M mobile processor is finally starting to gain ground against older mobile technologies in the US, 18 months after it was introduced to rave reviews, according to recent data from Current Analysis.

Notebooks containing the Pentium M accounted for 23% of all notebooks sold at retail in the US in October, said Sam Bhavnani, an analyst with Current Analysis.

Larger desktop replacement notebooks with Intel's Mobile Pentium 4 processor still make up the largest category of notebooks, but price cuts on the Pentium M have allowed retailers to offer thin and light notebooks at attractive prices, he said.

The Pentium M processor was introduced in March of 2003. It was Intel's first attempt at building a processor specifically for a mobile environment, and combined aspects of its Pentium III and Pentium 4 processors to create a high-performance chip that consumed much less power than the Pentium 4-based processors Intel had been recommending for notebooks at the time.

Business customers were the first targets for the processor, which shipped with a mobile chipset and an 802.11 wireless chip as the Centrino platform. Initial testers and users were pleased by the desktop-like performance and extended battery life enabled by the Pentium M, but consumers were slower to catch onto the benefits of the processor.

Part of that was because Intel did not spend as much time in 2003 educating consumers about the benefits of the Pentium M, Bhavnani said.

One of the key aspects of the processor was that it ran at much slower clock speeds than Pentium 4 processors but delivered comparable performance. However, consumers had been conditioned by years of Intel marketing messages that faster clock speeds equaled higher performance, he said.

For the past two years, consumers have been infatuated with larger desktop replacement notebooks that offer large screens and powerful performance. This is not the type of notebook that is suitable for a business trip, but is fine for customers who never take the notebook out of their homes or too far from a wall socket.

In September, that trend showed no signs of abating, at least among US customers. Toshiba and Hewlett-Packard introduced heavier notebooks with widescreen displays in recent weeks to focus on users looking for multimedia PCs.

This phenomenon is mostly confined to the US market. Consumers in Europe and Asia prefer smaller notebooks and sales of Pentium M notebooks are more robust in those areas, according to Intel.

Intel reversed its clock speed strategy in 2004, adopting a power-conscious design philosophy and introducing a new processor numbering system to communicate the relative performance of its chips. The company's consumer push started in earnest with the new numbering system, Bhavnani said.

Education is an important part of any company's marketing strategy, but so is price, Bhavnani said. One of the main reasons behind the uptake in Pentium M notebooks is the price cuts that Intel has put into place, allowing manufacturers to build thin and light notebooks - systems weighing less than 6lbs - at prices approaching $1,000, he said.

Intel's October price cuts on the Pentium M are starting to trickle through to the customer, paving the way for thin and light notebooks at prices that were previously reserved only for bulky notebooks, Bhavnani said.

Current Analysis' figures do not take into account sales by Dell, the world's largest PC suppliers. Dell does not sell PCs through retail channels. All of Dell's Latitude business notebooks use the Pentium M chip, while half of the eight notebooks on Dell's consumer web page are available with the Pentium M.

Tom Krazit writes for IDG News Service


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