COMPUTERS: Wintel CEOs Look For Relevance At Lenovo Beijing Bash
Bottom line: The presence of the CEOs of Microsoft and Intel at a Lenovo tech fest in Beijing represent the struggles that all 3 former PC giants are facing, and how each is looking to China in a bid to reverse its slide.
It’s not often that anyone uses the term Wintel anymore, which refers to the duopoly of Microsoft’s (Nasdaq: MSFT) Windows operating system (OS) and central microprocessing chips from Intel (Nasdaq: INTC) that dominated the computing world for decades. But Wintel was center stage this week in Beijing, in a rare case where the CEOs of both Microsoft and Intel shared the stage with the CEO of Lenovo (HKEx: 992), the world’s largest PC maker, which was holding a bash to launch a wide range of new products.
Lenovo has been steadily hyping this event that finally took place on Thursday, where it unveiled a wide range of new products like a dual-screen smart watch and laser projector smartphone, all of which looked interesting but not too exceptional. I wasn’t planning on writing about the event at all for that reason, until I spotted the photo featuring Lenovo CEO Yang Yuanqing taking a selfie of himself with Microsoft CEO Satya Nadella and Intel CEO Brian Krzanich at the Lenovo Tech World event in Beijing.
The photo itself was very cute, but also quite revealing for its inclusion of CEOs of 3 companies that are all grappling with fading relevance in the fast-changing world of high-tech gadgets. What’s more, Microsoft and Intel are both heavily invested in Beijing, the former with a high-profile R&D lab and ongoing Chinese investigations against it for tax evasion and unfair competition, and the latter with a major new local joint venture in the mobile chip space.
For all those reasons, it wasn’t too surprising to see this rare meeting of 3 of the world’s most powerful PC executives on a single stage in Beijing. The trio each gave speeches and demonstrations on a wide range of new products and technologies, and were also joined at the event by Robin Li, CEO of leading Chinese search engine Baidu (Nasdaq: BIDU). Someone ironically, it was the same Baidu that lured away the longtime head of Microsoft’s large R&D Beijing lab last fall, showcasing the growing lure of homegrown Chinese Internet giants and fading attraction of global names like Microsoft. (previous post)
Wintel was once a feared name in the world of high-tech gadgets, as the pair of Microsoft and Intel dominated the space through their decades-long control of the PC market. But neither company was very adept at making the move into mobile technology that has become the latest hot computing trend. That left Microsoft to lose out to Google’s (Nasdaq: GOOG) Android OS, and for Intel to be overtaken by British chipmaker ARM Holdings and its partners like Qualcomm (Nasdaq: QCOM) and Mediatek (Taipei: 2454).
Intel has been trying to fight back by boosting its efforts in mobile technology, and is placing big bets on China through its recent investment in a major chip design and manufacturing venture connected to Tsinghua, China’s leading science university. (previous post) Microsoft has been a heavy investor in China for years and has a major R&D center in Beijing, but more recently has been dogged by an antritrust investigation and allegations of tax evasion by the central government. (previous post)
Obviously it’s too early to write off either Microsoft of Intel, and it would also be quite premature to dismiss Lenovo, which is trying hard to parlay its leading position in PCs into the crowded mobile space. No one I’ve talked to is very impressed by Lenovo’s non-PC products, most notably its smartphones, which have still managed to find big market in China because of Lenovo’s local clout. If I were making predictions, I would say that when historians look at this photo of the 3 CEOs 30 years from now, they will say the trio represented the fast-fading world of tech names associated with traditional PCs, which were ultimately replaced by a new generation of companies like Google and ARM.
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