ANALYSIS: Client Profile - PR inside Intel: much more than just chips

Smart, aggressive PR has played a crucial role in defining Intel as a market leader and its management as hi-tech visionaries. But will its reactive, news bureau-style PR approach translate well as the company ventures out beyond the chip business? Aimee Grove reports.

Smart, aggressive PR has played a crucial role in defining Intel as a market leader and its management as hi-tech visionaries. But will its reactive, news bureau-style PR approach translate well as the company ventures out beyond the chip business? Aimee Grove reports.

Smart, aggressive PR has played a crucial role in defining Intel as

a market leader and its management as hi-tech visionaries. But will its

reactive, news bureau-style PR approach translate well as the company

ventures out beyond the chip business? Aimee Grove reports.





In a universe where few companies make it past their first birthday,

Intel Corp. has enjoyed more than three decades of prosperity as the

world’s largest computer chipmaker and one of Silicon Valley’s

certifiable blue-chip brands.



The company’s semiconductors command more than 80% of the laptop and

desktop market, its stock is a darling on Wall Street and its gross

profit margins hover around 60%. Moreover, Intel’s performance has

translated into a stellar corporate reputation that makes it a perennial

member of Fortune’s ’Most Admired’ list. (It ranked eighth overall and

first in the semiconductor category this year.) And Reputation Quotient,

the corporate reputation tool designed by NYU professor Charles Fombrun,

placed Intel number two behind Microsoft among the highest-regarded

technology companies.



Obviously, someone is doing something right in the PR department.





Sophisticated PR machine



Even grizzled, cynical journalists are keen on the company. ’Intel’s PR

is like Intel itself: smart, aggressive, well run, sometimes ruthless

when they need to be. They are one of the most sophisticated PR machines

in Silicon Valley,’ says Chris Nolan, a tech business columnist for

Upside Today and the New York Post. Another business writer for a major

national magazine calls Intel’s PR troops ’consummate professionals -

extremely professional and accessible.’



But today is a new day for Intel, which is branching out from its

devoted focus on microprocessors for PCs to other businesses such as

networking, information appliances and Web hosting. Intel isn’t alone,

as hi-tech stalwarts like Hewlett-Packard are also moving quickly to

mine those faster-growing areas. And at the same time, rival AMD

continues to nip at Intel’s heels with newer and faster chips, never

allowing the giant to get complacent in its core business, which still

accounts for up to 90% of Intel’s revenues today.



Can the image and positioning Intel has worked so hard to achieve

survive the more turbulent waters of new markets and new competitors

while continuing to protect its ’Intel Inside’ brand? That depends on

whom you listen to.



Up until now, the company has managed most of its press relations in a

reactive style similar to a news bureau. VP of worldwide press relations

Pam Pollace - who boasts that she still doesn’t have voice mail -

subscribes to the old school of corporate PR, which deems responsive

media relations as priority number one. Pollace, who joined Intel as the

’corporate spokesperson’ 13 years ago, views her team’s primary function

as that of a conduit to the media and to all the relevant audiences for

Intel information - and she doesn’t see that changing anytime in the

near future.



’I believe it’s our job to be the eyes and ears and to keep people here

aware of what’s in the news - both breaking news and trends. Also, it is

our job to keep the press informed and make sure we are working with

them on a timely basis,’ she explains.



To that end, the internal PR team is actually structured to resemble a

news bureau, with each member following a particular beat. Also, unlike

most companies of this size, Intel has never had a corporate agency of

record, with most PR staffers moving up from product and engineering

ranks and nearly everything except for a few specific areas handled

in-house, all under Pollace’s supervision. She has even joked about

tearing down the walls of Intel’s famed cubicles just to keep the

communication flowing.



’I feel it is important to have an on-site staff that really understands

the products,’ says Pollace. ’We’re very much a ’roll up your sleeves’

organization, and since we are all involved in day-to-day press

relations, it’s important that we all be accessible and available all

the time.’



Not everyone is an unabashed fan of Intel’s emphasis on reactive,

service-oriented PR, however.



’Intel is very good at following the tried and true methods of PR -

getting enough people, being responsive, knowing what reporters want.

But they are not terribly innovative,’ notes CNN San Francisco bureau

chief and West Coast technology correspondent Greg LeFevre. ’They’ve

never needed to be, because they knew we would always cover them when a

new chip came out.’



Analyst Rob Enderle of GIGA Information Group also wonders whether Intel

has the firepower at the top to do the job as it spins off into new

directions.



’All the PR people there seem to come from the engineering or product

side, not necessarily journalism or PR, and they don’t always seem to

know how to use analysts. There just seems to be a disconnect between

what they think we should do and what we really do.’



Such criticism may explain why Intel started warming to the idea of

using outside agencies a few years ago. About three years ago, the

company hired Cohn & Wolfe to support Intel’s extensive education and

community relations initiatives, a huge effort that includes high school

talent contests and science fairs, teacher development and community

access and education for low-income children.



’Our goal is to be, and to be perceived as, a major force in improving

math and technology education,’ says Tracy Koon, who heads up Intel’s

education initiatives within the corporate affairs group. ’We believe

this is a priority for our company, our industry, our country and the

world.’





More than just hi-tech press



Intel also hooked up with GCI Group to spearhead a push into consumer

and lifestyle publications. As part of this effort, Intel sponsored a

Whitney Museum American Century exhibit last year, which featured an

online exhibition center and scored the company placements in major art,

travel and lifestyle publications. Other consumer programs have included

a focus on health information online and a showcase of top women

executives in hi-tech.



On the corporate front, the plan seems to be to position CEO Craig

Barrett as the messenger of the company’s new direction and a leader up

to the task of such a transition. A recent cover story in Business Week

exemplified this strategy at its best.



Despite all the new ventures and shifting horizons, Pollace doesn’t

anticipate much change in Intel’s PR approach. ’I still think, at the

core, we are a technology company first. One of our big challenges now

is what it has always been - translating what the technology does and

what it means to all the different audiences,’ she says.



’Now we just have to make sure the brand doesn’t lose its meaning in all

of the new directions we’re going.’





INTEL



PR head: Pam Pollace, VP, worldwide press relations



PR staff: About 85 in the US and 180 worldwide



Internal PR managers: Corporate press & programs, Tom Waldrop and Ursula

Herrick; networking & enterprise press & programs, Tom Beerman;

technology PR, Howard High and James Smith; industry analyst relations,

Mike Green; corporate & public affairs, Tracy Koon and Dana Houghton



External Agencies: GCI Group for lifestyle/consumer-oriented media and

programs ; Cohn & Wolfe for education programs and initiatives



1999 financials: Operating revenues: dollars 29.4 billion



Net income: dollars 8.1 billion*



*Source: Intel.



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