Mr. Bones, what are your thoughts about the bundling of Internet service w/ PCs ? The trend seems to have started with Gateway and (recently) Dell and as of today, it seems Compaq is increasingly showing interest in this area. I, along with i'm sure many others on this thread, would be interested in your thoughts with regard to how this affects Mindspring. Do you forsee MSPG as a takeover candidate or does the advent of box maker "home grown" ISP service seem to indicate a more competitive future for ISPs such as MSPG? Thanks in advance for your thoughts.
Regards,
SH
Compaq unveils consumer PCs and its own Web access
By Eric Auchard
NEW YORK, June 15 (Reuters) - Compaq Computer Corp. <CPQ.N> on Tuesday unveiled its latest line-up of consumer desktop and notebook computers with monitors, printers and new Internet services as the company stepped up sales beyond the PC boxes themselves.
The No. 1 PC maker at a news conference here demonstrated a set of new Internet services, including its own Compaq.net branded service starting at $11.99 a month and NetZero, an ad-supported "free" Web access service.
While Compaq has suffered slack corporate PC sales this year, leading to a sharp drop in its stock price and a top-level executive shakeout, consumer PCs remain a bright spot for the Houston company.
Compaq's new consumer PCs are part of the industry's new product introductions that take place each June, ahead of the family back-to-school purchasing season that takes place later this summer.
But unlike previous years, Compaq is focused less on promoting features inside the new machines than on the products and services built around each PC, an approach shared by major rivals International Business Machines Corp. <IBM.N>, Hewlett-Packard Co. <HWP.N> and Dell Computer Corp. <DELL.O>.
"To be a long-term player, we probably need to be more than just a box player," Mike Larson, senior vice president and new general manager of Compaq's consumer unit, said in an interview.
The company showed off new Presario desktop PCs starting at $599 running up to $1,999, without monitors, for the fastest Intel <INTC.O> chips on the market. New Presario notebook models begin at $1,299 up to $2,999 and beyond.
"The Internet is the No. 1 reason why consumers are buying computers today," Larson said of Compaq's plans to package PCs with a selection of Internet services. "Customers are looking for one point of contact for the total package," he said.
The company introduced its new Compaq.net national Internet access service, which the company is wholesaling from Internet communications giant MCI WorldCom Inc. <WCOM.O> It replaces its existing Compaq Easy Internet Access service, which it had offered through GTE Corp. <GTE.N>
Compaq.net offers unlimited Web access for $11.95 per month with a 12-month up-front payment, or $9.95 for 10 hours per month and $17.95 for unlimited service with a monthly payment plan. Customers receive their first 100 hours of service free.
Seeking to turn customers into repeat-buyers, Compaq offers a single point of contact via phone for all technical support questions on both PCs and Internet services, bridging a divide that exists when Web access comes from a different provider.
Besides its own service, Compaq continues to offer America Online Inc. <AOL.N> Internet service and NetZero, a Web access service which offers free Internet access and e-mail in return for customers agreeing to view targeted ads online.
Larson declined to comment on whether Compaq had taken an equity stake in Westlake Village, Calif.-based NetZero, which is backed by venture capital firms Idealab Capital Partners and Draper Fisher Jurvetson and is allied with GTE.
Desktop color monitors are sold separately from PCs. A 15-inch model starts at $299, a 17-inch model runs $399 and a 19-inch screen costs $599. Compaq also introduced a $120 inkjet printer built by Lexmark International Group Inc. <LXK.N>
Compaq is offering rebates of $125 to $175 when a customer buys a monitor and printer along with a PC.
With rebates, a complete $599 system would sell for $892, slightly lower than systems from other major PC brands, but well above what consumers can expect to pay for low-cost entry-level PCs some start-ups now offer for $399 or less, before monitor and other equipment.
The new consumer PCs are designed to work with Compaq's home networking technology that allows families with multiple PCs to share Internet access within a home over one phone line and a single Internet access account. One desktop PC system on display offered movie-like surround sound with four stand-alone Klipsch speakers. The speakers cost $250 and the total system would run about $2,500.
At the news conference, Compaq also showcased "desktop replacement" notebooks with wide 15-inch screens and few if any sacrifices compared with a desktop PC.
A prototype of a new "road warrior" notebook on exhibit offered a light three-pound notebook detachable from a base holding both floppy disk and compact disk drives and multiple ports to plug in devices like printers or network connections.
The new products are available at build-to-order kiosks that allow buyers to assemble their own systems at major U.S. retailers or direct via telephone or via the web at compaq.com
Compaq stock sank 81 cents to close at $21.25, a new year-low, on the New York Stock Exchange, where it was the second most active issue.
19:45 06-15-99 |
