Intel waiting for a hit product to get MID market rolling

Intel is counting on the emergence of a hit product to kick-start demand for mobile Internet devices (MIDs) and spur sales of its Centrino Atom chip platform.

"By the end of this year, you will have seen a whole bunch of new MIDs coming out and we'll see which ones are hits," said Sean Maloney, executive vice president and general manager of Intel's Sales and Marketing Group. "You only need one hit."

Centrino Atom is based on the Silverthorne version of the Atom processor and includes Intel's System Controller Hub, a single-chip chipset that functions as the device's central nervous system. The chips were designed to be used in handheld computers that can be used to access the Internet and play multimedia files.

So far, very few devices based on Centrino Atom have been announced and given a release date; the few devices that have been announced are priced far above the $500 target price that Intel set for these devices. The rarity of these devices means Centrino Atom shipments are also low.

The sluggish pace of the MID market stands in sharp contrast to low-cost laptops and desktops based on the Diamondville version of Atom, which uses a traditional two-chip chipset. At the Computex exhibition in Taipei last week, hardware makers were falling over themselves to showcase their latest laptops and desktops based on Atom -- and complaining they can't get enough of the chips from Intel.

There wasn't the same level of activity in the MID segment, although several prototype devices were on display. Despite that slower pace, Maloney said the MID category will get traction in the market eventually.

"As yet, we don't have any hit devices.The product's only just come out and there are a bunch of people announcing products, but the smaller a device gets the more it becomes a fashion item," Maloney said, alluding to the challenge hardware makers face when trying to gauge consumer tastes.

"It's very difficult for a CPU company to pick winners there. It's not really so much in our gene pool," he said.

Laptops and desktops based on Atom -- which Intel calls netbooks and nettops, respectively -- are a different matter. Hardware makers and Intel can draw on years of experience with these products, including the first version of Asustek Computers' Eee PC, to create devices that appeal to users.

"The netbook is more predictable, it's really like a notebook. With a MID, there's much more experimental design in it," Maloney said.