Uncertainty surrounds Otellini visit in Taiwan due to dissatisfaction with Intel over WiMAX
Irene Chen and Monica Chen, Taipei; Adam Hwang, DIGITIMES [Wednesday 27 October 2010]
While Taiwan's government and business sectors think that Intel CEO Paul Otellini's visit to Taiwan on October 28 has something to do with WiMAX, Intel Taiwan on October 25 indicated that Otellini will neither talk about WiMAX during his visit nor explain how Intel will fulfill the terms of the WiMAX MOU it previously signed with the Taiwan government.
Intel Taiwan country manager Jason Chen, at recent meeting with government officials, was unwilling to respond to the question of how Intel will realize what it promised in the WiMAX MOU, despite the concerns it raises for the government. Instead, Chen indicated that Intel is willing to cooperate with Taiwan in cloud computing and other areas. In response to questions raised by Digitimes, Intel Taiwan indicated that Intel's promise to support WiMAX development remains unchanged. As for investment in a WiMAX system integration joint venture to be set up by the Ministry of Economic Affairs (MOEA), Intel is in close discussions with the MOEA and Industrial Technology Research Institute for evaluation and will not disclose details for the time being, Intel Taiwan added.
The government units concerned are dissatisfied with Intel's unwillingness to respond to questions regarding the WiMAX MOU, and think this will affect the arrangement of Otellini's visit, which is scheduled to include the signing of a cloud computing MOU as well talks between Otellini and President Ma. Although Intel has invited ministries to attend the press conference where it will sign a cloud computing MOU, the government holds a cautious attitude. This is because the government is weary of Intel not fulfilling the WiMAX MOU and holds the opinion that signing a cloud computing MOU before the fulfillment of the WiMAX MOU will cause a loss of focus and is not conducive to Taiwan's cooperation with Intel and other international enterprises.
Intel has remained in the feasibility evaluation stage since it signed the WiMAX MOU with the MOEA in 2008. Instead, Intel has asked the MOEA to make preparations such as establishing a WiMAX system integration company. MOEA complied by setting up a WiMAX system integration joint venture in the first half of 2010, but Intel still has not made any progress.
In view of Intel's investment of US$20 million to set up a joint venture, WiBro Infra, in South Korea in late September 2010, the Taiwan government is increasingly skeptical of Intel. In contrast with Intel's active promotion of joint venture businesses in South Korea, Intel has stalled during its two years in cooperation with Taiwan.
The WiMAX Program Office (WPO) served as Intel's window for communication with the Taiwan government. After Intel dismissed the WPO, Intel Taiwan took over the communications role. The dismissal of WPO, claimed by Intel to be part of adjustments in its internal organization, has actually caused negative impact on communication between Intel and the Taiwan government because Intel Taiwan, which is mainly responsible for marketing Intel products in Taiwan, has not been involved in previous negotiations and therefore is unfamiliar with details concerned, causing miscommunication between Intel head office and Taiwan, and which could damage their long-term cooperative relationship.
Otellini's visit is intended to boost cooperation between Intel and Taiwan, but the current conditions show that Intel headquarters has to better understand the situation in Taiwan, otherwise the agenda of the press conference is subject to uncertainty.