I think that the major reason that Intel is seeing problems with its bottom line is that consumers don't see anything that they really are excited about buying from Intel. I base this solely on my personal experience and perspective. I am sure that many well informed financial analysts and tech industry experts would just shake their head at my statement and stop reading. But at least hear this one consumer out for a minute.
I am a consumer looking to upgrade to a new CPU. My fastest computer has a Core 2 Duo E8500. It has served me well but I should probably upgrade to a quad core processor based system that is faster. One of the problems I have with Intel is that they have way too many products for me to get my head around. Not only are they offering several products based on different CPU sockets but they are offering a lot of processors for each socket. Every time I get serious about picking a processor I have to study and learn all the different processor numbers to understand which processor is right for me. How can you create a demand for something when people don't even know what you have? Could Intel create a processor naming strategy linked to honest and objective benchmarking so that consumers can actually make a choice? If automobile manufacturers have to list fuel efficiency standards shouldn't CPU manufacturers list performance standards and tie that to a clear naming standard? If I don't know that your new processor is better than my old one why would I want to buy it? Why should I have to read a dozen or more articles by computer hardware websites in order to know what I am looking at when I shop for a computer? If the strategy is to confuse the consumer then I think that is a strategy that in the long run backfires. It may help sales in the short run to pass off "new" technology as better because it is newer but people catch on quickly.
In a supply and demand economy if something becomes scarce and people still want it then it goes up in value. Intel should be able to raise its price for processors and see no decrease in profits with the reduction in computer sales. But people don't even know if they should buy a new computer with a new CPU. Intel should use this current reduction in demand from OEM manufacturers to simplify its product line and invest in some really good marketing that educates the public about their products. I think if Intel is relying on OEM manufacturers to create demand for Intel products they will see real problems with sales in the future. When I buy or build a computer I look at the components in it. It makes a difference to me whether it has an Intel or AMD processor in it. It makes an even bigger difference what type of processor from Intel or AMD it is. If Intel allows people to think in terms of OEM brand quality like Dell, HP or even Apple as determining product choice instead of component quality as being key to choice then Intel becomes an invisible component like the many nameless screws, brackets and cables inside my computer case. Yes, Intel dominates the market and AMD is not much competition. But what if ARM, Samsung, AMD and who know else becomes equivalent to an Intel processor in consumer's minds because they are all buried inside a case with the Dell, HP or Apple logo on it? When a computer has a clear "Intel inside" sticker on the front, with a clear "what kind of Intel" is inside, and a performance designation that people can understand then Intel will not have to worry about lowered profit expectations because of OEM problems. When this happens Intel products will become even more valuable and profitable when the OEMs have problems. I hate to say it but it seems like a bad case of marketing on Intel's part and that is what the markets should really worry about when investing in a company's stock. The first question investors should ask is not "what will the supply" of Intel products be but what will the DEMAND be for Intel products. The demand for Intel products is more in Intel's hands through their marketing than in other suppliers of PC components.
