Talking tech since 2003

Any remotely successful salesperson will tell you that “up-selling” – the process in which one convinces a customer to upgrade a package – is a very important skill to have in pretty much every industry. However, Intel, one of the largest computer chip manufacturers in the world, has arguably taken the concept of up-selling a bit too far with the introduction of “pay to upgrade” processors.

More or less, Intel is selling low-end computer processors, and selling an “upgrade” option to allow users go receive better performance. Now, I know what you’re thinking; this doesn’t sound like anything new. And this statement would be somewhat true, as manufacturers sell upgrades all the time. However, the strategy in which Intel is using is really a whole new ballgame. You see, Intel is shipping out select low-end processors that are programmed not to perform to their full potential, and then selling customers an electronic software package (purchased like a gift card) that removes said limitations by “unlocking” hidden threads and cache; two aspects that are critical for the performance of a processor.

That’s right. Intel is forcing customers to pay to get the most out of the hardware that they already purchased.

Is this a good business move? The answer to this question is difficult to draw, mainly because we have yet to see many people’s opinions about this new concept.

On one side of the argument, Intel is providing a cost-effective and instantaneous way for people to upgrade their computers as their needs change. Having said this, one can purchase a computer with a limited processor, and only pay for the extra specs (more threads and cache) when the need for them arises. Ultimately, this means that a consumer wouldn’t be paying for power that they would not use. On top of this, non technically-savvy users would be able to upgrade their computers without having to pay the full price for a new processor, or having to pay a technician to install it.

On the other hand, many would argue that the cost of manufacturing the “limited” processor is no lower than the cost of manufacturing an “unlocked” version of the same processor. In this light, Intel is not incurring any additional production costs, causing me to question their justification in charging to unlock the full potential of a device; a device that the consumer has already paid for. If anything, I feel that this business move will do nothing more than cause people to spite Intel, and ultimately avoid their products because of their business practices. And of course, being considered “shady” is not something that any company wants, especially in an economy such as our own.

Moral aside, we have to consider that Intel would likely sell a great volume of processors simply by selling the “unlocked” ones at the same price as the “limited” ones. This would surely land them greater numbers of bulk purchases by computer manufacturers who have started leaning towards AMD processors. Add this to the number of individuals who would choose lower-priced Intel chips when upgrading their personal computers, and Intel would definitely see an increase in business.

One thing that I am curious about is the concept of jailbreaking. As you know, the United States Copyright office made ramifications in June that clarified the definition of “jailbreaking” as a legal process in which one installs third-party software on a hardware device. While this cleared up a lot of confusion in regards to the iPhone and iPod at the time, I am eager to see if anyone takes advantage of this to unlock said processors without paying the upgrade fee.

In the long run, there are a lot of questions about these new “upgradeable” chips – questions that will be answered in time. Will people buy them? Will people spite Intel for them? Will people bypass the restrictions? Be sure to leave a comment or pop into the chat room to share your opinion.

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