Intel takes on AMD with F1 sponsorship

SAN FRANCISCO (Reuters) - The computer chip industry's biggest rivalry just expanded from the computer rack to the race track.

Intel said on Wednesday it will sponsor BMW's Sauber Formula One racing team, pitting it against top competitor Advanced Micro Devices, which sponsors a Ferrari car.

Intel would not reveal how much it is paying to sponsor the BMW team, but said it was similar to a title sponsorship, which can range from US$8 million a year for a low-ranking team to nearly US$70 million for the best cars.

The deal also calls for the German luxury car maker to buy computers using only processors from the world's top chipmaker, which has come under increasing pressure from AMD.

AMD has made inroads into the network computer market with its Opteron server processor, and in the laptop market with its Turion chip.

BMW, which has 100,000 employees and 3000 dealerships, will roll out Intel-based servers, laptops and handheld computers over several years, Lewnes said.

Intel's brand will be plastered on the car of BMW's Sauber team starting in January 2006. Each of Formula One's 19 yearly races are watched by more than 150 million people.

"The sport is very demographically appropriate for us, it skews highly male, affluent, and technologically savvy. The reach, the audience and the fact that it is so technology dependent makes it a great fit for us," Ann Lewnes, Intel's vice president of partner marketing, told Reuters.

Lewnes dismissed the idea that, in terms of the F1 deal, Intel is inhaling the exhaust of AMD, whose Scuderia Ferrari team placed third this season, ending a run of six consecutive titles with star driver Michael Schumacher.

"We are a leadership brand. We don't copy anyone. The magnitude and scale of what we are doing is why we made our decision," Lewnes said.

Under the deal, BMW and Intel will also work together over the next several years to develop a way to easily integrate consumer devices such as laptops, portable music players and mobile telephones into BMW cars, Lewnes said.