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Rectron CEO, Mark Lu, received a letter from AMD on 21 January 2002
advising Rectron to purchase AMD products from a third-party in
Austria. According to AMD, the reason for this was for Rectron to
remain competitive in the marketplace. Apparently all the local AMD
distributors were advised to buy AMD processors from a third-party
company.
"This request from
AMD was in principle a breach of normal distribution practice," says
Lu. "At the end of March 2002 we were advised that if we didn't
support the third-party our distribution agreement with AMD would be
terminated.
"This put us in a
catch 22 situation. Either support the grey market or not distribute
the product at all. This situation is not only present in SA but is
also causing huge concern among distributors and resellers all over
the world.
"This is not the
way we do business. We don't expect our channel to deal in grey
products so why should we? It would have destroyed the trust we have
developed in the SA market over the years and jeopardised our standing
with our other principles."
Lu dismissed
speculation that its success in the Intel environment caused the
break-up between itself and AMD and that it had become a
non-performance issue. "We've certainly been very successful with
Intel since acquiring the Intel distributorship a year ago (June
2001). Intel is obviously what the market wants and we have to
deliver. Intel represents about 90% of our current CPU sales.
"But we certainly
haven't ignored the AMD market. They are still featured in our current
catalogue so the market still has a freedom of choice. Currently, it
is choosing Intel and we're obviously supporting that demand
especially when we can't depend on AMD.” |
