Centrino notebooks lagging with U.S. retail customers

Intel Corp. has put millions of dollars behind its campaign to support its Centrino notebook technology, but the message isn't reaching the U.S. retail market, and may miss the pivotal fourth-quarter holiday shopping season, analysts said Tuesday.

The Centrino package combines the Pentium M processor, the 855 chip set family, and the Intel Pro/Wireless 2100 chip for connecting users to 802.11b networks. Introduced in March, the technology has received very positive performance reviews from hardware enthusiasts and corporate notebook users, but retail buyers have spent their dollars on other technologies, said Stephen Baker, director of industry analysis at NPD Techworld in Reston, Virginia.

Only 4.7 percent of all notebooks sold at retail during August came with the Centrino package, according to research from NPD Techworld.

The corporate market has traditionally represented the bulk of the notebook market, but U.S. consumer interest in multimedia desktop-replacement notebooks has driven much of the growth this year, and brought the percentage of consumer notebook purchasers more in line with corporate buyers, said Matt Sargent, an analyst with ARS Inc. in La Jolla, California.

Consumers have snapped up bulky notebooks that offer desktop-like performance with fast processors and large LCD (liquid crystal display) screens on which to view DVDs or play games, Sargent said. This group of buyers doesn't particularly care about mobility or battery life, since they rarely take the notebook out of their homes or unplug it from the wall socket, he said.

"The biggest issue with Centrino at retail is the feature set just didn't match what people are looking for, until the last couple of months," Baker said. Notebook vendors such as Toshiba Corp. and Hewlett-Packard Co. have recently introduced Centrino into widescreen retail notebooks.

The focus of Intel's Centrino marketing has been wireless technology, which hasn't caught on as yet with the retail notebook buyer in the U.S. as a must-have technology, Sargent said. That buyer is more concerned with price and perceived performance, two areas where Centrino has an upward battle, he said.

The Pentium M processor combines architectural features of Intel's older mobile processors with performance features found in chips such as its Pentium 4 processor. By most accounts, it outperforms Intel's older mobile processors, even though it runs at slower clock rates.

But Intel has failed to communicate that performance difference to retail buyers, who compare a 1.6GHz Pentium M processor with a 2.4GHz Mobile Intel Pentium 4-M processor, and think the 2.4GHz label denotes the higher performing chip, Sargent said. And when those buyers look at the notebook's price tag, and discover the Pentium M notebook costs a few hundred dollars more, they are opting for the Mobile Intel Pentium 4-M notebook, he said.

Intel admits that retail buyers have not received as much attention in the first six months of Centrino's life, said Barbara Grimes, an Intel spokeswoman. The company focused its initial marketing campaign on corporate buyers and road warriors looking for lightweight and wireless notebooks as their primary targets, she said.

Consumers in other parts of the world, such as Asia, are more keen on thinner and lighter notebooks than their U.S. counterparts, Grimes and Sargent said. Centrino notebooks have done better at retail in Asia and Europe than they have in the U.S., they said.