Compaq seeking ally for wireless-linked devices
PARIS, Sept 13 (Reuters) - Compaq Computer Corp. CPQ.N,
the world's No. 1 personal computer maker, is gearing for a
complete redefinition of the PC and working on alliances to
produce simpler, redesigned devices with wireless links, its
chief executive said on Monday.
"Our goal should be to build really cool stuff," Michael
Capellas, the U.S. computer maker's newly hired president and
chief executive, told a news briefing as he completed a
European tour aimed at outlining strategy for the company.
Houston-based Compaq's direction has been blurred since
predecessor CEO Eckhard Pfeiffer was forced out in April by a
board unhappy with repeated sales problems and slow progress in
expanding beyond PCs.
Capellas told a conference organised by research group
International Data Corp. that he believed one key outcome from
the Internet explosion would be a dramatic change in what the
PC is.
"The new wave says how do we make these machines simpler
and simpler -- with specialised functions. Wireless
connectivity becomes the actual baseline," he said.
Asked if this focus meant fresh alliances, he said: "You
can assume we are aggressively pursuing that, and no, I won't
say who." He added that Compaq aimed to have established "close
relations with somebody before the end of the year."
Capellas, facing faster-growing rivals like Dell Computer
Corp. DELL.O, which sells direct to customers via telephone
and increasingly through the Internet, said Compaq was already
making considerable use of Internet distribution channels in
its dealings with large corporate account customers.
Compaq is is also exploiting the Internet to sell networked
data storage, an area set to be a focus for dramatic growth, he
said.
"Inventory is the enemy," he added, referring to a key
competitive advantage grabbed by Dell in its advance.
While direct-selling's benefit in eliminating stocks from
the supply chain was clear, he also highlighted the Internet's
potential to simplify product design, noting that Apple had
"established that there is great appeal in industrial design."
In selling to large businesses, Compaq should "go back to
our roots and really create an Internet infrastructure," with a
focus on offering "non-stop capabilities," Capellas said.
Non-stop is Compaq's catchphrase for a range of high-volume,
fail-safe computer systems capable of running the largest
business operations, including Internet-based ones.
An innovative advertising campaign was due to start in the
next quarter, he added.
Shares of Compaq, which earlier announced price cuts on its
entire line of commercial desktop PCs in a bid to regain sales
momentum, lost 5/16 of a point to 24-7/8 in active afternoon
trading on the New York Stock Exchange on Monday.
(Sara Ledwith, European Technology Correspondent, + 33 6 07
02 93 21)
REUTERS
Rtr 15:24 09-13-99
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