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

OPPORTUNITY THREAT
•Intel may reap more benefit due to •Slowing PC market may hamper
investment in Micron and Samsung Intel's profit
•High profit margin due to its •Dependency on Rambus memory
efficient microprocessor chip will badly effect its Pentium 4
microprocessor chips market along
with existing
•Lack of support to Rambus from
memory chip producer and chip
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maker will make the situation more
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worse
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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