Intel losing its joie de Viiv

Next year, Intel plans to simplify its processor branding strategy by de-emphasizing two of its major brands, Viiv and vPro, and consolidating all of its marketing around the Core brand, CNET News.com has learned. The move will keep Viiv and vPro on the little sticker affixed to a PC--ground zero for chip marketing--but it will end Intel's attempts for now to recreate the success of its Centrino marketing in other areas.

Intel representatives said the move will actually allow it to generate more interest in Viiv, a collection of chips and software that was designed for home entertainment PCs, by hooking it up to the more well-known Core brand. First unveiled at the Consumer Electronics Show in 2006, Viiv PCs are supposed to make it easy to use a PC at the center of your digital home.

But the problem is that PC shoppers have never grasped what Viiv (it rhymes with five, by the way) could do for them. Intel successfully managed to associate Centrino--a package of a mobile processor, chipset and wireless chip--with wireless networking, even though wireless networking was around for years before Centrino.

But it couldn't attach Viiv to anything, other than the derision of the press corps and analysts. And it will be very difficult for Intel to realize the dreams it once had for Viiv if it officially relegates it to second-tier status.

Viiv "will be something that will die and won't be missed," said Stephen Baker, an analyst with NPD Group. "I don't think anyone will notice it's gone."

Intel says it isn't digging a grave for Viiv and vPro, a brand for business PCs, just yet. The plan is to use "Core" as the primary message and add Viiv and vPro to the end, said Vince Thomas, brand strategist in Intel's corporate group. PC shoppers in early 2008 will see a "Core 2 with Viiv" sticker on high-end PCs instead of the standalone multicolored Viiv sticker.

"We decided that it would be better to have fewer brands and make those as strong as we can--Centrino for mobility and Core basically for all the other computing segments we're addressing in the client space," Thomas said. This also means that the Duo and Quad addendums to the Core 2 brand will disappear.

After about a year on the job, marketing boss Sean Maloney is getting back to basics after the short tenure of Eric Kim, brought in from Samsung to revolutionize Intel's marketing and who will probably be remembered as the guy who changed Intel's iconic 35-year-old corporate logo. Kim is currently head of Intel's Digital Home Group, removed from his position as chief marketing officer following an executive shakeup last summer.

A source familiar with Intel's plans said the company might reuse the same branding strategy from the Pentium days as it moves forward into the Core era. That means you'd see a Core 3, followed by a Core 4. If that comes to pass, the Nehalem generation of Intel's processors could be the Core 3, or Core III if the company really wants to be historically consistent. Still, nothing has been officially decided.

But Centrino isn't going anywhere. Intel CEO Paul Otellini announced during the company's earnings conference call earlier this week that the chipmaker will make Centrino the central focus of its marketing efforts during the second half of the year. Earlier this year, Intel signaled its intention to downplay vPro by announcing that business notebooks will be known as Centrino Pro systems.

Viiv and vPro were the second and third legs of Intel's platform strategy. Just like Hollywood, sometimes when companies produce a hit, like Centrino, they think they can replicate that success with a similar formula.

In order to qualify for the Centrino marketing program, Intel requires PC companies to build systems with one of its mobile processors, an Intel mobile chipset, and an Intel wireless chip. In exchange, Intel promotes the benefits of Centrino and partially reimburses PC companies for their own notebook marketing efforts.

The concept, unveiled in 2003, was well-timed to the explosion of notebook PCs. Mainstream PC shoppers began replacing desktops with notebooks, and soon learned the benefits of wireless networking. As a result, Centrino quickly became one of Intel's best-known products.

Inside Intel, the three-pronged package also signified a new design strategy in which the processor, chipset and networking chip were all designed together, rather than by separate groups. The company quickly settled on this design philosophy as a way to prevent it from wandering in different directions, and Otellini actually reorganized the entire company around that premise.

In Viiv's case, Intel wanted PC shoppers to associate that brand with the perfect multimedia PC, with plenty of performance for media decoding, networking chips that streamed movies around the home, and smart software that makes all this as easy as setting the clock on the VCR. Later, Intel would unveil services branded to work with Viiv PCs and big-screen TVs, such as a fantasy-football application from Yahoo.

The problem is that people haven't shown wide interest in using PCs this way. And those who have are generally savvy enough to know what kind of performance and software they need without having to match little colored stickers on PCs to software applications and services.

The Viiv name is odd, of course. But success of Nintendo's Wii has shown everyone that it's very possible to attach a weird name to a great product or experience.

PC buyers just don't understand what makes a Viiv PC a Viiv PC, Baker said. Whereas Centrino stuck in buyers' minds as wireless networking, Viiv never offered PC users anything they really wanted or that they couldn't get elsewhere.

People understand Core as a brand because it represents Intel's best available processor, Baker said.

"Every once in awhile Intel starts to think they can separate themselves from the hardware," Baker said. "These things remind them that at their core they are a processor company."