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Intel: Upgrade Service Beneficial To Partners

Intel's new Upgrade Service would allow customers to access additional capabilities for around $50, but what are the benefits for partnering system builders?

The Intel Upgrade Service program allows PC buyers to boost performance for tasks such as video and photo editing by downloading upgrades over the Web. The program is still in an early stage and Intel has begun reaching out to channel partners to gauge their interest, an Intel spokesperson told CRN Monday.

"We have been doing this program with resellers for several weeks but the retail program is not yet launched," the spokesperson said.

The Intel Upgrade Service program is slated for launch in the fourth quarter and will only apply to 2.80-GHz Intel G6951 desktop processors, according to the spokesperson.

"This program is just for one SKU," the spokesperson said. "We have a hundred others that don't apply."

As it currently stands, the program is for retailers, and is thus oriented toward customers. "We're just giving customers an additional configuration option," the spokesperson said, confirming that the upgrade will cost around $50.

Though published reports have indicated Intel will sell the upgrades through Best Buy, the spokesperson declined to confirm the list of retailers Intel will partner with on this project.

Intel is also positioning the Upgrade Service as a way for resellers and system builders to simplify their product SKU lineup and offer customers more choices.

Companies must be members of the Intel Channel Partner Program in order to take part, but they also benefit from the opportunity to add additional third party software or hardware to the systems their customers upgrade, according to Intel.

Thus, while system builders can build upgradeable desktop computers, resellers can then upgrade CPU performance down-the-wire -- after the upgrade -- in order to increase their margins.

"This enables a single system to have two separate performance options, giving your customer point of sale flexibility and new sell-up opportunities," according to an Intel Webpage that describes the value proposition for partners.

Todd Swank, vice president of marketing at system builder Nor-Tech, Burnsville, Minn., says Intel's server motherboards sometimes require customers to buy a key to unlock certain features, but this is the first time he's heard this model applied to desktop PCs.

"I'm struggling to see where the benefits are for system builders," Swank said. "They showed it to us with everything enabled. If anything, this seems to cheapen the product."

Intel says it shares revenue with the partner each time they sell the Intel Upgrade Service, but how much this amounts to isn't clear from looking at the company's Website.

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