Hewlett-Packard Cuts Computer Switch Prices Below Competitors
Palo Alto, California, May 18 (Bloomberg) -- Hewlett-Packard
Co. said it will lower prices on its least-expensive computer
networking switches to a point well below rivals' prices, seeking
a larger share of a crowded yet important market.
The company said it will cut the price of its AdvanceStack
2000 switch 44 percent to $1,249. The equipment uses so-called
Ethernet switching technology to move data between computers in
small offices, or work groups.
Although Hewlett-Packard once was among the market leaders
for older networking gear sold to work groups, it fell far behind
rivals Cisco Systems Inc., 3Com Corp. and Bay Networks Inc. when
those companies introduced products using newer technologies. By
slashing prices, Hewlett-Packard may be able to win back part of
a $2.5 billion annual market.
''The primary thing that moves product in this market is
price,'' said Esmerelda Silva, an analyst with International Data
Corp. The AdvanceStack 2000 has 12 ports, or user connections,
giving it a per port price of just over $100. The average per
port price for similar products is around $130, Silva said.
Hewlett-Packard's brand-name recognition and distribution
network, combined with the new lower prices, likely will allow it
to regain some customers, Silva said.
Even though work group switch sales are a low-margin
business, it is important for Hewlett-Packard to maintain a
presence in the market, she said.
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