VBI: A Very Bright Innovation

Easy Optical Swapping. Forget about stocking slews of slimline ODDs. CBB-compliant optical drives secure with a single screw and can pop into any CBB notebook.

The CBB program is actually a subset of the Verified by Intel (VBI) barebones notebook initiative. In essence, VBI is about making sure that whitebooks are customizable, serviceable, and based on Centrino. The effort recognizes that interchangeable parts are only one advance in the battle to make whitebooks an attractive item to stock and sell. Another key objective is to create a common channel experience without sacrificing flexibility in configuration. This starts at the original device manufacturer (ODM), of which there are currently three in the VBI program—ASUS, Compal, and Quanta—which not so coincidentally are the three largest notebook ODMs in the world. Do your Googling and you'll find that Compal, for instance, makes models for Dell, Toshiba, Acer, HP, and many others.

As of this writing, there are 11 VBI notebooks on the burner, all Napa-based with 945GM and 945PM chipsets. Rather than try to tackle everything at once, Intel is focusing VBI on mainstream SKUs hitting within the most popular 80% of the market, and today that means 14.1", 15", and 15.4" screen models. Intel's Matt Harrison notes that Intel still encourages diversity from vendors with models outside of the VBI program, such as Twinhead with its semi-ruggedized designs or MSI with its 12" and 17" models.

Verified by Intel primarily accomplishes three things. First, it ensures that the integration experience goes as smoothly as possible. A PDF integration guide is included, as are a hard drive casing, power brick, and a Verified by Intel letter (co-branded with the ODM) that describes to to resellers Intel's participation in the SKU, how to reach Intel for customer support calls, that Intel will manage replacements and spare parts, and where integrators can go for more information.

Individuality? Stick It. The adhesive CBB top panel sets into a slight depression covering most of the LCD lid. Patterns can range from corporate logos to family photos.

Second, VBI helps streamline the supply chain to reduce channel pricing. Obviously, generic parts breed higher run rates and lower production costs. But Intel has also engineered the program to streamline Proprietary notebook batteries and AC adapters will soon be a thing of the past-at least for channel resellers who adopt CBB-compliant laptops. According to Ron Sakurai, associate vice president of component product management at Synnex, Intel lined up a single aggregator in Taiwan that buys directly from the three VBI manufacturers. The aggregator, which handles all regions beyond Asia-Pacific, ships to the four U.S. distributors currently handling VBI parts. This keeps sourcing costs down and alleviates a lot of the troubles that disties faced when dealing directly with ODMs in Taiwan.

"One of the only ways to be cost-effective earlier was to get a big container load of notebooks, like 2,000 at a time," says Intel's Wes Sieker. "You literally had all the notebooks lined up and then a box of screws for all 2,000 units and maybe one poorly translated document to understand how to assemble it. How those systems got passed down to the system builder was very inconsistent. We're looking to build that consistency with VBI so that everybody who gets a box gets everything they need and has a consistent integration stream. Manuals will be in proper English. There will be extra screws. Units will be single-packed so its easier for distributors to handle them. We want to add some of the value you get normally from Intel boxed products without having it be about us."

All reseller telephone support for VBI notebooks will be handled directly by Intel, just as is the case already with Intel server platforms, which should come as a relief to resellers who have been turned off by some vendors' support in the past. Additionally, Intel will be stocking Shop Intel with screws and interchangeable parts, again, just like server spares are offered already. This is meant to operate as a backup source to distributors, not a primary parts source. Expect pricing to show a convenience-oriented premium.

Not least of all, VBI is about overseeing product development. The seven CBB components are a part of this, but Intel also uses the VBI program to manage communications regarding product changes, roadmap evolution, and documentation.

Change doesn't happen overnight. Expect to start seeing effects from these various notebook programs late in the second quarter to the third quarter. Intel has made substantial investments toward fostering this whitebook evolution over the last 12 months, but there's still plenty more lying in wait.

The AMD Element

In 2005, ASUS had only one AMD-based whitebook model. According to ASUS' Raymond Chen, that number will "drastically increase" in 2006. There are two primary reasons for this. First, AMD has developed a massive amount of respect in the enthusiast consumer world for its Athlon processor lines. As users transition from desktop to mobile platforms, performance nuts are likely to appreciate an AMD alternative. Just as Intel has staked much of its sales on a reputation for stability over the years, AMD now sports maximum performance appeal. The inference is that this applies as much in the mobile world as the desktop and server.

Still single. AMD is gaining share in the mobile space likely because of technical merit or simply having a market alternative-or both. However, AMD has yet to present a dual-core opponent to Intel's Core Duo.

Second, under certain conditions, the Turion 64 really does outperform the Pentium M or Core chips. According to ASUS' Raymond Chen, if you pit "equivalent" Pentium M and Turion 64 chips against each other, the Pentium M will win on performance. However, because the Turion 64 line scales up higher in clock speeds, you can build a faster AMD-based notebook today than an Intel one on two conditions: 1) You're willing to pay for the higher clock speed Turion 64 chips, which is feasible given that AMD generally sells for fewer cents per megahertz than Intel, and 2) your application set is single-threaded.

Obviously, AMD has a feature advantage in its mobile line in that, as with the Athlon 64 family, the Turion 64 line supports x86 64-bit extensions. However, the only real argument for mobile 64-bit computing today is future-proofing, presumably for the arrival of Windows Vista's 64-bit edition. After all, it's not like today's notebooks can accommodate memory sizes above the 4GB mark where 64-bit platforms really shine. Would a customer wanting to run a 64-bit OS nine to 12 months from now really want to lock into a machine based on today's clock speeds using a CPU socket already destined for near-term extinction? Probably not. Moreover, most independent Web reviews have found the Pentium M and Turion 64 lines fairly close on both real-world power consumption and performance.

Currently, though, AMD has no reply to the Core Duo. The Turion line is slated to go dual-core sometime "in the first half of 2006," so Intel's window of advantage on this score may not be as large as some had supposed. For today, though, if mobile users are leveraging multi-threaded applications or multi-tasking single-threaded apps, the case for Core Duo seems persuasive. For the gaming machines finding increasing use at LAN parties and such, Turion 64 is an excellent choice.

A Blank Slate. This ASUS Z62F is available as a whitebook shell the reseller can then brand as it sees fit. Resellers also have the option to apply a "Built on ASUS" sticker for co-branding.

Despite the fact that, according to AMD product manager Matt Mantini, AMD had over 100 Turion platforms either shipping or in development at the end of 2005, AMD whitebooks have thus far been more of a thought experiment than a market reality. The company expects this to change with April's release of three 25W TDP parts—MT-32 (1.8 GHz with 512K of L2 cache), MT-34 (1.8 GHz, 1MB), and MT-37 (2.0 GHz, 1MB)—in "without fan" (WOF) SKU versions. Until now, AMD has hitherto never released Turion 64 parts in a WOF package, and now these will be available for single-quantity purchase.

"This will enable resellers around the world to finally offer AMD-based whitebooks," says Mantini. "And we'll make it easy for them by offering just a single processor versus what we've done in the past, which was tray option kits. Unless you have a volume opportunity, it's very difficult for a reseller to buy a whole tray of processors and hold them. By offering a single processor in an option kit, this makes it much easier for resellers to satisfy the AMD-based notebook market demand."

CPUs Made Simple. The days whitebook shredding in order to swap a CPU are over. Most units now provide heatsink access via a back panel. Just jimmy out the heatsink and you're at the CPU socket.

AMD mobile brand manager Scott Shutter notes that one AMD advantage over Intel is its component agnosticism. Unlike Centrino, which dictates that the wireless module and chipset must be of Intel make as well as the CPU, AMD places no such restrictions either technically or, as Shutter puts it, "on marketing mojo." There are no strings attached to program dollars on Turion 64 CPUs purchased through authorized distributors. However, as we saw with Pentium M designs that adopted ATI chipsets and Broadcom or other wireless cards, Intel puts no barriers put on cross-brand compatibility. Additionally, Intel's Todd Garrigues, North America channel marketing manager for boxed products, confirms that Pentium M and Core chips qualify for Intel Inside program benefits just as do whitebooks sporting the entire Centrino platform, although the percentage of benefit may be higher for a platform purchase versus a stand-alone processor.

It's no secret that Intel has vast amounts of cash versus AMD (roughly 14X as of 4Q'05) to spend on things like product promotion and channel marketing. AMD does what it can with what it has. When prioritizing where to put its resources over the last few years, AMD gave precedence to server and desktop platforms over mobile, and the market has rewarded AMD well for its choices. But as PC sales shift increasingly toward mobile, one wonders about the strategic fallout waiting for AMD as a result of having more or less ignored the whitebook space up to present. While Intel is pushing the CBB program and making whitebooks feasible in the channel every way it can imagine, AMD is delivering its first single-quantity Turion SKUs into distribution. When we asked AMD what it was doing to help foster whitebook business for its partners, company reps replied that they "were not at liberty to discuss" their channel efforts at this time.

"Could a competitor copy our interchangeability formats for, say, swapping screens?" muses Intel's Wes Sieker. "We would actually welcome that. It would bring more people in the system builder space to have better innovation and bring down prices. I don't know that that anyone else is doing enough volume yet to change things economically, but collectively more volume will bring prices down."

We could argue for hours on whether Intel building a whitebook industry will help AMD more than AMD's participation will help Intel. The bottom line is that you'll have more choices to offer customers depending on their needs, and that means more sales and better margins.

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