Door Is Open For Compaq To Regain Desktop Edge
CRN Reseller Poll:Hardware --
February 22, 2000
John Roberts & Warren S. Hersch
New York - Dell Computer Corp. is
losing momentum in the small- and
midsize-company market, opening
the door for Compaq Computer
Corp. to take control. The only
question: Will Compaq be able to
capitalize on this opportunity?
Last summer, Round Rock,
Texas-based Dell overtook Compaq
for the top spot on the best- selling
desktop list, according to the CRN
hardware poll. This was the climax
to a dramatic, two-year surge in
the percentage of VARs citing Dell
as their best-selling PC in this
market segment. This percentage
nearly doubled last year alone,
rising to 13.3 percent in 1999 from
7 percent in 1998.
But there are signs Dell's inroads
are finally coming to an end. In
January, 12 percent of VARs cited
Dell desktops as their best-sellers,
down from 14 percent in December
and 16 percent in November. The
January figure was only slightly
above the 10 percent reading in
January 1999.
Six-month moving average data,
which provides a longer-term
perspective by smoothing out some
of the month-to-month variations in
these figures, confirms this recent
slowdown in Dell's momentum.
Following strong increases
throughout most of 1999, the
percentage of VARs citing Dell
desktops as their best-sellers
peaked in November and declined
in both December and January.
This is a classic illustration of the
so-called law of large numbers,
showing that while it is easy to
score big gains when starting from
a small base, it is much more
difficult to keep up the big gains as
the base gets larger. And when
looking at best-selling desktops-or
notebooks, for that matter-Dell's
base has become a lot larger in the
past two years.
With Dell's momentum slowing, can
Compaq re-establish its position as
the best-selling desktop vendor in
the small- and midsize-business
arena?
Survey data from January shows 16
percent of respondents cited
Houston-based Compaq as the
manufacturer of their best-selling
desktop in the small- and
midsize-company market. This was
the highest percentage among all
major vendors, and the highest
figure for Compaq in particular
since last April. It also was the first
time since August that Compaq
grabbed the top spot on the
best-selling desktop list.
"Compaq has taken steps toward
leveling the playing field with
competitive pricing," said Mike
Wintory, president of MicroAge
Galesburg, a VAR in Galesburg, Ill.
"This has enabled VARs like us
working in a smaller tertiary
market to compete head on with
the computer superstores and mass
PC merchants."
But Compaq's recent plans to sell
more PCs direct to the business
market could hinder further upward
movement, according to CRN
survey data. Two CRN spot surveys
show between one-half and
two-thirds of responding VARs
would shift business away from
Compaq if the vendor goes through
with its plans.
In all, 200 VARs responded to the
January survey.
Other results from the survey show
white boxes are strengthening their
position in the small- and
midsize-company server market, as
VARs that build their own systems
look to key in on profit
opportunities in this market
segment.
After languishing during the
summer months, the percentage of
VARs citing white-box servers as
their best-sellers has jumped up.
For example, 32 percent of VARs
surveyed in January said white-box
servers were their best-sellers, one
of the highest figures in the past
year.
"White-box servers are less
expensive to build and offer better
margins than branded machines,"
said Terry Gray, vice president of
sales for Ohio Cash Register Inc., a
reseller in Medina, Ohio.
The white-box server comeback has
nipped at the percentages of some
major vendors. Compaq still is
holding its own, but the percentage
of VARs citing Dell servers as their
best-sellers dropped to its lowest
since last May.
crn.com
Copyright c 2000 CMP Media Inc.
By John Roberts & Warren S.
Hersch |
