Intel introduced the G6951 unlockable CPU consumer product this month. Most of the press has been critical. Is this new chip / upgrade process a bad product, or a good product with bad positioning?
The Consumer Desktop Upgrade Cycle
Desktop computer consumers buy or build their own computers. After some period of time, as their computer performance declines (a natural effect of computer usage). Over time, new software continues to be released that places ever higher demands on the computer’s processing power. As computing becomes ubiquitous, consumers’ expectations of the capabilities of their computer continue to grow. These three factors cause consumers to become less satisfied with the performance of their old computers, and they desire to upgrade their performance.
Upgrade options for consumers previously were limited to two options – replace components within an existing computer with higher-performance components, or purchase a new computer to replace the older computer.
Intel introduced a third option with the G6951 CPU – unlock latent capabilities in the existing hardware.
The CPU Upgrade Process
A consumer wants to improve the processing performance when they believe that their desktop is CPU-bound and that upgrading their CPU will improve the overall desktop performance. [This is usually not the best price-performance single component to upgrade, but that is not the point of this discussion.] The consumer, having decided to upgrade the CPU of their desktop has the following options:
- Purchase a new CPU, disassemble their current computer and replace the old CPU with the new one. Note: This may require replacing the motherboard (not all CPUs work with all motherboards), which may then cascade into a need to replace other components or add additional hardware to enable other existing components to continue to work.
- Purchase a new desktop computer, install their existing applications onto the new computer, migrate data, set up the new computer on the network, connect and configure their existing peripherals (printers, scanners, etc), set up user accounts and security on the new computer, and possibly replace existing peripherals that do not work with the new computer.
- Purchase a $50 upgrade card at a retail store and enter the code to increase the performance of their current CPU, with no other changes.
Intel’s Value Proposition
Given the assessment above, there are some significant benefits to consumers of having a CPU that can be upgraded in-place.
- Avoid the time spent upgrading components or migrating to a new system.
- Enable a performance upgrade at a much lower price point. New, better-than-you-already-have CPUs are not available for $50, nor are entirely new desktop computers.
- Avoid the waste (ethical benefit) and disposal (practical benefit) of the components or computer you are upgrading (replacing).
- Extend the lift of existing hardware, likely reducing the dollars-per-year that the consumer spends on desktop computers.
There are also some potentially significant benefits to Intel of a product that is designed this way.
- Eliminate the processes of binning (testing and sorting identically manufactured CPUs based on their maximum performance) and reducing the complexity of logistics of handling multiple CPUs (at different performance levels).
- Simplify their product offering (possibly) by collapsing multiple performance-levels of the same CPU into one part number.
- Reduce overhead costs by carrying fewer CPUs in inventory.
- Possibly gain market share from AMD by having their CPUs be perceived as more compelling by computer manufacturers who believe they will sell more desktops that include the consumer value props outlined above.
Press Reaction
The most common reactions and reporting in the press have positioned Intel’s offering as the following:
- Intel takes advantage of consumers by shipping crippled CPUs that require an additional fee to unlock their true potential.
Pretty brutal. Here are some articles in the press.
- Intel to sell CPU performance upgrade cards at retail – Geek.com
- Intel’s Annoying Pilot Program Offers Chip Upgrade for a Fee – PC World
- Intel’s Misunderstood Upgradable Chip – TG Daily
Discussion
So – what do you, product managers, think?
- Does this new product solve a valuable problem for consumers that they might be willing to pay for?
- If so – was the positioning bad?
- What would you do differently? Or do you believe that any press is good press?
No one that I’ve seen has written an article that starts with the upside, so this article emphasizes the positive, while the linked articles emphasize the negative (about the product).
Chime in below or on twitter.com (include a link to this article, and your tweet will show up below).
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