How? Well, the market was three-quarters P4s, from just over a third a year ago. And so while the average PC dropped 8% to Rs 33,000, Intel’s ASV grew 8%. And its share of the PC value went from 16% to 19%. (Intel did lower Celeron prices to counter AMD and Via in the Rs 20k category.)

But Intel’s channel success story hit some rumblers—discontent among distributors on margins and gray sales. Top distributor Tech Pac switched to AMD. That left Redington, Ingram, SES and Nebula (now eSys). Intel finally took steps to curb gray sales, such as "de-listing" defaulters from its GID list. These helped bolster margins, interest, and CPU prices.

An upcountry program took channel and consumer activities such as "PC parties" into the lower half of the top 23 cities, ahead of a small-business-user thrust.

Intel dropped its WiFi products (it will only supply chipsets). Network cards and mother-board sales ramped up. The Dialogic division (a 1999 acquisition) sold computer-telephony cards worth an estimated Rs 40 crore.

Intel’s India Development Center (IIDC) in Bangalore created a new wireless mobility design center to focus on Centrino work, inter al. Intel Capital made some new investments after negligible activity for two years. Intel’s education added up to a score of 200,000 teachers trained.

Intel is now pushing portables through the "white-box" model. But its big mobile play is the all-new Centrino, with integrated WiFi—the main message during president Paul Otellini’s first India visit in June. Intel also launched the P4HT (with hyper-threading), and faster Itanium and Xeon chips. The Itanium did not take off—the CIO still doesn’t see Intel inside big iron.

But the big believer is the government. Its tenders mostly specify Intel systems, and its lakhs of PC purchases on the cards could help maintain that 90% share.