Why isn't Intel telling the whole Centrino story?

INFOWORLD HAS an interesting piece about the lack of Centrino penetration in US retail. In that market for August, less than 5% of notebooks sold were Centrino based. Two paragraphs from that story highlight what Intel isn't doing.

The article claims that the Pentium M processor combines features of Intel's older mobile processors with performance features in the Pentium 4. It is a better performer than the older notebook chips, although clock rates are slower.

But the article points out that customers are still comparing, for example, a 1.6GHz Pentium M with a 2.4GHz Mobile Intel Pentium 4-M processor. That means people think that a 2.4GHz chip is faster, while a Centrino based machine is more expensive.

Intel has allocated at least $300 million to promote the advantages of its Centrino platform, but it has failed to explain the frequency issue in its marketing. For those that may buy a Centrino notebook, this is probably the most important point they need to understand.

The Pentium M processor, which is part of the Centrino platform, is 37% smaller in die size than the P4. By shipping more Centrino, Intel would not only improve its margins and revenue, it may also be able to close a fab or two, thus bringing more value to its shareholders. So you would think that it would be in Intel's best interest to be pushing Centrino for all it is worth.

Senior Intel executive Anand Chandrasekher has said he believes the next round of corporate PC upgrades will be for notebooks.

So Intel truly believes that the notebook platform will take off. And its faith in this has been manifested by the money it has made available to drive the Centrino message home. Intel's paradox, however, is that it is not telling the whole Centrino story.

So why has Intel been coy about its frequency conundrum?

The reason may be a June 2002 lawsuit that was filed in Madison County, Illinois against Intel et al. The plaintiffs allege that Intel and PC vendors misrepresented the performance of the Intel Pentium 4 processor.

An INQUIRER story from last week showed a picture of a giant lizard - named Chipzilla - giving out leaflets, which happened to be standing outside a courthouse in Edwardsville, Madison County, Illinois. Could this be that lawsuit?

If it is, then an advertising campaign that highlighted Centrino's lower frequency performance attributes could have proved damaging to the defendants. As it is, their failure to state the obvious could be used against them in court.

I believe that Intel and its fellow defendants would be happy to settle this case out of court. But it would seem that the litigants want their pound of flesh.

This PC World story, which broke the litigation case, highlights the financial exposure if the defendants should lose, especially if class action status is granted.

"Noting the sheer number of P4s Intel has sold, the complaint goes on to say the "Class is so numerous that the individual joinder of all members is impracticable" and that the Class could include "hundreds of thousands of members." According to MicroDesign Resources, Intel has shipped upward of 50 million P4s since its launch in November 2000.

What is the likelihood of other PC vendors that are not named in the current complaint being sued if the plaintiffs should win? It may start a stampede of people who want a piece of the monetary action. µ