Compaq to Downplay Intel Co-Op

Computer Maker Doesn't Want to Be Part of Intel Inside Push

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SAN FRANCISCO-In a serious blow to Intel Corp.'s "Intel inside" branding program, Compaq Computer Corp. last week said it will forgo millions of dollars of co-op money because it doesn't want to promote the chip brand.

Compaq, the No. 3 marketer of personal computers, will no longer include Intel's logo on product stickers, packaging and point-of-purchase material for consumer products, such as Presario and Aero computers.

James Garrity, Compaq's director of marketing communications, said the Intel logo program detracts from Compaq's brand by turning PCs into commodities.

Other PC marketers have groused about this, but Compaq appears to be the first major PC seller to announce a partial split with Intel.

"*`Intel inside' is counter to our own [branding] program," Mr. Garrity said at a PC conference sponsored here by Advertising Age's Business Marketing.

Compaq will pass up "probably millions of dollars" in co-op funds, he said. It still will accept Intel co-op money for ads and for its business computer lines.

"Obviously, there is some symbolism here" in dropping part of the program, Mr. Garrity said.

Intel remains Compaq's main chip supplier.

Intel has grown to be a huge world brand since 1989 through the ad, co-op and branding program.

The company downplayed Compaq's move. "Compaq is one of our biggest customers and biggest supporters of the program," said Sally Fundakowski, director of processor brand marketing.

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