Intel Goes vPro

The battle for the desktop is back on. But this time, the aim isn't to win consumers, and the combatants aren't Microsoft (Nasdaq: MSFT  ) and Apple (Nasdaq: AAPL  ) . Instead, it's a duel between Intel (Nasdaq: INTC  ) and Advanced Micro Devices (NYSE: AMD  ) for the hearts and minds of big-budget corporate buyers.

Intel raised the stakes Monday. Its new chipset, called vPro, is cut from the mold of Centrino, a package of chips and software for mobile computing that, as of last year, had grown into a $5 billion franchise. But packaging is where the similarities between vPro and Centrino end. This new platform is designed to help partners such as Dell (Nasdaq: DELL  ) and Hewlett-Packard (NYSE: HPQ  ) produce desktop PCs that are more energy-efficient, easier to manage, and more secure, according to Intel's announcement.

Frankly, it's impossible to judge whether these claims are supportable, because no vPro PCs will be available before the third quarter, according to a story in Tuesday's San Jose Mercury News. The newspaper story said that the strategy poses risks to Intel, since corporate buyers may choose to purchase AMD rather than wait for vPro.

Maybe, but I don't think so. Why, you ask? Vista. The next version of the Windows operating system has been delayed till at least November, which means the upgrade cycle for PCs was already stalled. That's taken a toll: Trade publication IT Week in the U.K. reports that Korea's Samsung expects to lose as much as 6% of second-half operating profit because of the delay. So if IT managers are already waiting, why not wait for vPro?

What's more, vPro is Intel at its best: a whole-platform products that box makers can gobble up and ship in their PCs. Accordingly, there's every reason to believe that when Vista finally arrives, vPro's volume will be unleashed. And that could come shortly after Apple debuts Leopard, its next-generation OS, with sleek new hardware and heaps of Intel-compatible software. Next year at this time, we could be writing about Intel's smashing success on the desktop.

But don't let that be a reason for you to go buying this stock. Intel may yet prove to be a compelling value, but it remains weak in the area where demand is highest: servers. Here, AMD's Opteron has been on a tear, and there's no sign of that ending soon. It's also unclear whether the new Woodcrest chipset will do much damage. (It has received high technical marks from industry analysts I've spoken with.)

The investing thesis for Intel isn't simple. I like vPro; it's a smart move, but it isn't a panacea. Instead, it's a welcome relief for a company that was desperately in need of a meaningful innovation to impress the IT community. Now, finally, it has one.

Double-dip your chips in related Foolishness:

Microsoft, Dell, and Intel are Motley Fool Inside Value selections (Dell is also a Stock Advisor pick). Get an all-access passto Inside Value to find out which other stocks are helping chief advisor Philip Durell beat the market by nearly 4%. You'll also receive instructive lessons on valuation and company analysis. Give Inside Value a try; it's free for 30 days.

Fool contributor Tim Beyers wonders when Apple and Intel will team up for business PCs. Not soon, apparently. Tim didn't own stock in any of the companies listed in this story at the time of publication. You can find out which stocks he owns by checking Tim's Fool profile. The Motley Fool has an ironclad disclosure policy.

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 513057, ~/Articles/ArticleHandler.aspx, 10/24/2016 4:52:43 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 2 days ago Sponsored by:
DOW 18,145.71 -16.64 -0.09%
S&P 500 2,141.16 -0.18 -0.01%
NASD 5,257.40 15.57 0.30%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/21/2016 4:00 PM
AAPL $116.60 Down -0.46 -0.39%
Apple CAPS Rating: ****
AMD $6.52 Down -0.44 -6.32%
Advanced Micro Dev… CAPS Rating: **
DELL.DL $0.00 Down +0.00 +0.00%
Dell CAPS Rating: *
HPQ $13.80 Down -0.30 -2.13%
HP CAPS Rating: ***
INTC $35.15 Down -0.28 -0.79%
Intel CAPS Rating: ****
MSFT $59.66 Up +2.41 +4.21%
Microsoft CAPS Rating: ****