Intel Corporation Product Transitions and Demand Generation

In July 2001, eight months after the release of Intel’s Pentium®4 processor, sales of the new product had not met expectations. This was due in large part to significant downturns in world markets following record microprocessors demand in 1999 and early 2000. At the same time, Pentium III processor sales had not declined as rapidly as expected; in fact, production of desktop Pentium III processors was accelerated in the second quarter of 2001 to meet demand. Intel was faced with critical decisions about how to turn the tide to make the continuing transition to the Pentium 4 processor a success.