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Customization coming trend, Intel exec says

Computer vendors will increasingly tailor their wares to market segments, especially small business, says Intel's Paul Otellini.

NEW YORK--Forget the one-box-fits-all model, or the PC as we know it.

Armed with a wider variety of processors, hardware, and software than ever before, computer vendors will increasingly tailor their wares to market segments, especially small business. So says Paul Otellini, executive vice president of the architectural business group at Intel, who gave a keynote speech today at PC Expo.

"You will buy only the computer platform that you need for your particular use," he told the audience.

Touting upcoming Intel products, Otellini separately confirmed that the Xeon Pentium II processor line will come out in two weeks on June 29, while a standard desktop Pentium II chip running at 450 MHz will emerge a bit later.

"We are going to set new records in price and performance with Xeon," he said. "With the release of Xeon we are poised to become a homogeneous, unified architecture."

Notwithstanding the Xeon's qualities, the future calls for a greater variety of computer products. The increasing pervasiveness of information technology, combined with the growth of the Internet, is leading to a world where the vast majority of users will find themselves accessing data in a variety of ways, Otellini said.

This means the needs of users have become much wider. The industry will respond by offering customized products based on standard technologies.

According to Otellini's Intel-centric vision, employees in manufacturing, for instance, will use low-end PC systems with Celeron processors. Those higher up the food chain will enjoy more expensive machines based around full-fledged Pentium IIs, or next-generation Xeon-based workstations. All will be hooked into communication applications constantly.

Although large businesses will take advantage of customization, the phenomenon will have a stronger effect on small businesses, many of which are still in the technology adoption phase. Small businesses will also see more and more complex back-end software systems coming down to their level, systems that were once the province of large businesses. Increasing numbers of small enterprises will further begin to hook their inventory and data systems into the Internet.

While some studies have questioned the value of technology spending, Otellini asserted that its has helped organizations to become more efficient. "Technology is becoming the most important competitive differentiator in small business," he said. "There is a direct correlation between growing revenue 'per head' and deploying personal computers and deploying them in a networked fashion."

Otellini also reminded the crowd that these remain the salad days for the IT industry. IT professionals, he said, "are no longer staff. You have a direct impact on the competitiveness of your companies."

And despite recent downturns, the industry will continue to grow, he added. Information technology accounts for approximately 1.7 percent of the GDP of the largest 20 national economies. In a few years, IT spending will account for more than 3 percent of the world's GDP.

"In mature economies, over 50 percent of all businesses are already connected," he said.

Later on, the executive also offered some comments on a pending antitrust lawsuit recently filed by the Federal Trade Commission. Otellini said that Intel had acted within its rights. "We believe we are within the current law with our actions," he said. "We are not disputing the facts of the case. It is a point of law that has to be decided."

The FTC has alleged that Intel withdrew confidentiality agreements from three computer vendors after the computer vendors tried to assert patent claims against Intel and/or one of its partners. The FTC has said that such actions constitute anticompetitive behavior, which is illegal of a company it deems to be a monopoly. Intel denies it is a monopolist.

Intel is an investor in CNET: The Computer Network.