TAMPA BAY, Fla. — ATI Technologies Inc. usually wows consumers with its products, but at the System Builder Summit Tuesday the graphics card developer wowed system builders with a licensing arrangement it says will make the company and its partners
Thornhill, Ont.-based ATI has inked licensing deals with third-party board manufacturers Guillemot/Hercules, PowerColor, Sapphire and Gigabyte to provide its chips for their products. In return, the licensees can supply ATI products along with their own in an integrated solution directly to the system builders. This, according to Randy Baker, marketing manager business development for ATI, will enable smaller distributors, for example, to purchase products from PowerColor, Gigabyte, Sapphire and Guillemot directly.
“”You are on the same playing field in terms of pricing and now they can go out and compete with anybody. Now it is a matter of going out and marketing our technology and augmenting what the system builders partners are doing with added marketing to create demand,”” Baker said.
Rick Morgan, president of Ace Computer Warehouse, a system builder based in Peoria, Ill., said ATI has developed a good program.
“”System builders are looking for some kind of discount or added value. With ATI coming on board with this kind of program it will benefit us. They are focusing on the white box market-place versus the guys that we are selling to,”” Morgan said.
The cost savings are complimented by the quality of the graphics chips, he added.
“”Money means a lot to people and yes, money savings gets people’s attention. But when you doing it with products from ATI it is much easier to sell,”” Morgan said.
A Gigabyte executive, meanwhile, said the deal will help the partners produce better products of their own.
“”ATI has better services, better technology, and provides more information and makes it easier for us to make better VGA cards,”” said Gary Chen, field sales manager for Gigabyte Inc. of City of Industry, Calif.
Chen added that the partnership with ATI could increase Gigabyte’s market share by 50 per cent. Baker said he thinks the licensees can help ATI achieve the same goal. More partnerships are a possibility, he added.
“”We have more coverage. We are basically worldwide now. We have a broader array of product features. We also have more aggressive pricing because the business models that our add-on board partners work under is much more efficient than what we have to offer at ATI.””
The licensees also add considerable marketing muscle to ATI. For example, Guillemot has 80 people working in marketing in North America. Add another three more marketing departments from PowerColor, Gigabyte and Sapphire and ATI has considerably extended its marketing reach, Baker said.
“”We have alleviated the pricing issue and expanded our presence in the market,”” he said.
Marketing power will also come in the form of a System Builder program, which ATI announced at the Summit Tuesday. The program will comprise marketing funds that will be paid directly to the system builder, added technical support, a marketing tools kit, and an e-newsletter. The System Builder program will be officially launched in North America in April.