Intel toughens up to safeguard branding

In a move to protect its brand image, Intel has cracked down on subsidising advertisements which use computer company logos other than its own 'Intel Inside' logo.

Intel subsidises PC makers' advertisements if they carry the Intel logo, under a cooperative marketing scheme which has reportedly cost Intel $2bn (#1.26bn) since it began in 1991.

But if those manufacturers carry other logos, Intel will cut their cooperative marketing dollars by a third or more unless they stick to a set of stringent marketing guidelines.

A company representative said: 'This is the biggest cooperative marketing operation in the world. The presence of other people's logo reduces Intel's ability to communicate its ingredient.' She said the rules will allow other logos to be present, but that the amount of subsidy offered by Intel will depend on where the logo is placed in the advert.

Intel's branding, she said, was the second most successful in the US after Coca Cola.

It objects to paying for adverts which carry competitors' logos in a prominent position. But Intel's stance may put vendors in a difficult position. Many have agreements with other manufacturers to help pay for adverts.

Keith Warburton, executive director of the Personal Computer Association, said: 'Intel always spelled out what size the logo should be. What has changed is what other logos you have on a page. He who pays the piper calls the tune, but people should be aware of who is playing the tune.'

Separately, Intel last week posted quarterly results which showed profits up 40% on the same quarter the previous year, to US$1.31bn, on record revenues of $5.14bn. The company's gross profit margin ran as high as 57%.