THE TIMES OF INDIA

FRIDAY, AUGUST 29, 2003

Intel, Legend to form joint research centre

REUTERS

BEIJING: Semiconductor giant Intel Corp and Legend Group Ltd, China's
biggest computer maker, on Thursday said that they would open a centre to
develop home network technology and security applications.

The move was seen as largely symbolic, cementing a relationship between the
world's largest chipmaker and Legend, which controls about a quarter of the
Chinese market and whose PCs now carry Intel chips exclusively, despite
recent advances by Intel's chief rival Advanced Micro Devices Inc.

The Intel project is part of a broader move by Western firms to set up
research-and-development centres in China, which are relatively inexpensive,
help them customise products for China and earn goodwill by training
domestic engineers.

Earlier this week, French telecom giant Alcatel SA and Japan's NTT DoCoMo
Inc both announced separate research-and-development commitments in China
valued at $145 million and a more modest $5.3 million, respectively.

The Intel centre, to be based out of Legend's Beijing facilities, would have
30-40 engineers, said Intel China president Wee Theng Tan.

He declined to give the value of Intel's investment in the project, saying
it would largely depend on the scope of future research.

Tan said that research would focus on technology linking televisions,
computers and other appliances into a digital home network and making
computers more secure.

"It's the next big thing," he said in a phone interview. "Many of our
efforts are proactive, and from a research-and-development perspective, we
have focus programmes that look at products three to five years ahead of
time."

Intel said on Wednesday that it planned to build a $375 million assembly and
test plant in western China that is due to begin operations in 2005 or 2006.

Construction on the plant in Chengdu, in Sichuan province, will begin in the
second half of 2004 and is expected to be completed in 2005.

About 40 per cent of Intel's sales come from the Asia-Pacific region, making
it the largest geographic segment for the Santa Clara, California-based
company. China is the firm's second-largest market after the US.

Tan said that Intel had an interest in meeting the needs of Legend, one of
its biggest customers in China.

Legend, which recently adopted Lenovo as the English-language brand name for
its PCs, has been pushing to diversify its core computer business into
creating home networks that link up TVs, printers, mobile phones,
refrigerators and DVD players.

It has joined firms such as Microsoft Corp, Sony Corp, Hewlett-Packard Co
and Samsung Electronics Co Ltd in an alliance to create open standards that
could make it easier to send music from computers to TVs.

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