Wintel - Cooperation or ConflictAssignment Questions Siddharth Setia – A042, 8030120044 10/17/2013 be it: Basic. continuously evolving so as to stay on top.0. THE DRIVERS OF PROFITABILITY FOR MICROSOFT AND INTEL ARE AS FOLLOWS: Intel: Intel relentlessly pursued Moore’s Law. and could not have happened without steady monopoly profits. doubling the number of transistors on its CPU every 18 months. Neither were the obvious. Intel Inside – The Intel Inside campaign was the most successful campaign by Intel till date which has led to “brand recall” in the mind of end-users. Microsoft’s own products enjoyed the added advantage of direct OEM distribution. OEMs began bundling their computers with both DOS and Windows pre-installed. What are the areas of potential conflict and cooperation? The rise of Intel and Microsoft is a remarkable episode in economic history. These took the PC industry by storm when it emerged as the preferred interface for IBM compatible PCs. and Digital Research did better software than Microsoft. or Windows 3. initiating a trigger in the minds of consumer wherein they preferred buying Intel processors over AMD or other competitors. Both companies were fairly unimportant when IBM chose to back them for its launch of the IBM PC. both were far behind their rivals. strong choice. Both Intel and Microsoft started with weak technology. AREAS OF CONFLICT AND COOPERATION PCI bus initiative Indeo – Digital Video Compression standard ACE – Advanced Computing Environment Windows Inside Program . effectively doubling Microsoft’s OS revenue per PC. Microsoft: The main driver for Microsoft’s growth in this industry was because of the Operating Systems.Assignment Questions: 1) Analyse the drivers of profitability in Intel and Microsoft. MS-DOS. Microsoft itself is a puzzle. Intel has done a remarkable job of overcoming its clumsy roots and coming close to the state of the art today. Instead. It has never been a high-concept company. This transformation has come at an enormous cost. Intel Architecture Lab (IAL) – This played a crucial role in driving new industry standards and broadened Intel’s role in the industry. If we pick the late 1980s as a point of reference. it has taken routes that others could have or would have taken and dominated markets with its lessthan-amazing products through aggressive marketing and its very successful collaboration with Intel. Zilog and Motorola built better CPUs than Intel. Hold its ground or c.a Microsoft had the option to hold its ground as Intel processors were largely associated with Windows only (as Microsoft had the upper hand). declining market share for Windows.k. However. breaking certain technology barriers boosting sales of both Intel and Microsoft. NSP would have helped Intel getting a traction which would have worked a contrasting effect for Windows. 3) Given the above analyse what would you choose from the 3 options listed above: a. Apart from that. Try to reach a compromise? If in this current situation. there was a new need for a tool to provide users with ways to interact with the systems. This advancement might enter Microsoft’s territory but still would be running on Windows based PCs (as Windows is the market leader in operating systems). Microsoft’s dominant market share is protected by high barrier to entry. b. as IBM computers advanced. Second. In 1984. Microsoft filled the niche with its first operating system. Thirdly. Microsoft’s customers lack a commercially viable alternative to Windows. certain decision would have to be taken up at our end that would have been to arrive at a compromise. Microsoft’s share of the market for Intel-compatible PC operating systems is extremely large and stable. . Therefore. Bill Gates (Microsoft) had the option to demand stopping the NSP product.2) Each company has the options of a. Hold its ground or c. Caving to others’ demands. the company released its first version of what would become its core cash product—the Windows operating system. It’s a vicious cycle which would have engulfed both Microsoft as well as Intel. MS-DOS. Bill Gates a. Hence. Microsoft at the peak of the PC industry enjoyed a monopolistic position because of 3 main reasons: First. b. Try to reach a compromise. it’s a win-win situation even in case of a compromise. In your assessment what (among the above 3) is likely to be the best strategy for Bill Gates (Microsoft)? Microsoft was founded by two high school classmates and originally began as a software language provider. Caving to others’ demands. The situation would be different if a compromise took place as that would mean a technology advancement and faster processing frequencies which could have been provided by NSP.