Intel Corp. unveiled its first so-called Web appliance, which gives consumers a built-in phone, Internet access and e-mail, in the company's latest move beyond its core business of microprocessors for personal computers. by Michael Fitzpatrick
26 Jun 2000 - The No. 1 semiconductor maker said the Intel Dot.Station Web appliance would be offered by Internet service providers, most likely as part of an overall service package similar to those for cable TV set-top boxes or cell phones.
Designed by Intel, the device would be built by overseas consumer electronics manufacturers. It will run on the upstart Linux operating system that has emerged as a rival to Microsoft Corp.'s Windows software.
"This is the first in a family of products," Greg Welch, director of marketing for Intel's home products group, said in an interview. He said Intel expects to be shipping hundreds of thousands of the devices by year-end.
"It's not unreasonable to guess that this is a billion-dollar business opportunity. The question is will that come in two years, three years, four years," Welch said. "There's no doubt we see strong indications of a robust market." Intel does not expect to sell the machines directly to retail, he said.
'A family communications product'
Besides Internet access and e-mail, the Intel Dot.Station would provide features such as a built-in calendar, address books and note-posting capabilities, Intel said.
The Dot.Station, which consists of a single free-standing unit with a monitor and a separate keyboard, has a high-resolution screen that can show the full width of a Web page and includes a built-in phone.
"It's fundamentally a family communications product that unites Web-browsing, e-mail, some nice home organizational applications, even an integrated telephone," Welch said.
"It's targeted to those households that don't yet have a PC," but are nonetheless interested in getting online, he said. "Installation consists of plugging in the power, plugging in the phone line, plugging in the keyboard and turning it on."
While the devices are most likely to be provided as part of an overall service package, the cost would be comparable to low-priced PCs in the $500-$700 range, Welch said.
"Our largest customer fully intends to offer the device to their customers at this point for free," Welch said. He declined to name the Internet service providers involved in talks with Intel.
The appliance comes with software that allows service providers to remotely manage and upgrade the devices.
Service providers would be able to customize the content and services of the devices to match their brands, Intel said.
The decision to use Linux software to run the Dot.Station came at the request of customers, Welch said.
Currently, the PC market is dominated by machines using Intel processors and Microsoft software.
Welch said Intel did not expect the new devices to begin whittling away at the overall PC market.
"I don't see it cutting into the PC business," he said. "Quite frankly, it would be my expectation that if consumers use our device, become comfortable with it ... they might find a need for a PC in their lives sooner than they would have if they had never bought the device."
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