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Technology Stocks : Compaq

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To: Ibexx who wrote (28703)7/9/1998 9:28:00 AM
From: Roads End  Read Replies (1) of 97611
 
ibexx..From Walter Mossberg's column in today's WSJ.

Steve

Computer Makers Sell Off
A Few Pieces of Your PC

By WALTER S. MOSSBERG

WHAT IF YOU discovered that your expensive new television set was
rigged at the factory so that every time you turned it on, the TV
automatically tuned itself to the same predetermined channel? What if it
was a channel whose owners had paid the TV maker to stick it in front of
your face? And what if the only way to disable this "feature" wasn't
explained in the manual? Most of us would be pretty steamed.

Yet that's exactly what is happening with a far more expensive item, the
home personal computer. Pieces of the PC are being sold off -- pre-wired
to link to sites on the Web whose owners have paid for the privilege. The
trend started in software, when Microsoft added a garish "channel bar" to
the desktop that turns your screen into a home for the logos of its on-line
business partners, such as Disney and Warner Bros.

Walter S. Mossberg answers selected computer and technology
questions from readers in Mossberg's Mailbox. If you have a question you
want answered, or any other comment or suggestion about his column,
please e-mail Walt at mossberg@wsj.com.

Now, the sell-off has spread to hardware. In its new Presario PC line for
consumers, Compaq Computer has placed special quick-access Internet
buttons on the keyboard, supposedly to make it easier for novices to get
on-line. But three of these four buttons are prewired to take you to Web
sites whose proprietors are paying Compaq to drive traffic to them.

Originally, the company planned to make it impossible for users to
reconfigure these three so-called Easy Access Internet Buttons. But after
receiving criticism from reviewers and test users prior to the machines'
release date, it came up with a method that technically allows users to
reprogram the buttons with their own favorite sites. But it is so obscure
and poorly explained that few will use it.

THE NEW Presarios themselves are very nice machines, which sell for
attractive prices starting below $1,000. The midrange $1,599 Presario
5030 I've been testing comes with a 300-MHz Pentium II chip, a huge 64
megabytes of memory and eight gigabytes of hard-disk space, a
high-capacity Zip drive for backing up data, and a fast 56K modem.

It also sports a pair of the new all-purpose serial ports, called USB
connectors, conveniently located at the front of the machine. There's even
a relatively cheap, optional $999 flat-panel screen, like the ones in laptops,
that hooks into a special connector on the Presarios, though I found the
one I tested a bit dark for my taste. Not only that, Compaq throws in 50
free hours of Internet access from GTE and offers a $100 rebate on the
computer if you sign up for the offer.

Furthermore, as I've noted in the past, it's a great idea to have special
keyboard buttons that instantly connect users to the Web. The idea was
pioneered by Hewlett-Packard a couple of years back. And the Presario's
new Internet Keyboard improves on the basic concept, with four buttons:
one for general Web surfing, one for searching the Web, one for getting
your e-mail and a fourth for doing shopping on the Web.

I can't blame Compaq for loading the
buttons with Web pages of its choice that
will appear the very first time a customer
uses them. It's better than making novices
go through a tedious set-up process.
Compaq's choices aren't bad -- the main
portal site, for instance, is a
Compaq-customized version of Yahoo!.

My problem is that Compaq's design
seems intended to discourage users from
customizing the buttons to their own
tastes, and instead appears aimed at force-feeding them Compaq's
favored sites. For instance, the computer's button-reconfiguration
software, which is easy to find and is described in the manual, only allows
users to change the e-mail button and one other special key elsewhere on
the keyboard. There's no provision for reprogramming the Web surfing,
searching and shopping buttons, and the manual doesn't hint that it's
possible.

IT IS POSSIBLE to change these three buttons, but only if users get
on-line, dig into the company's tutorial Web site and find an obscure set of
Web pages containing forms for making the changes. Any user who wasn't
visiting the keyboard tutorial pages wouldn't even know the reconfiguration
feature existed. The special Compaq/Yahoo portal site made no specific
reference to it until this week, a day after the company learned I was
planning to criticize the situation in this column.

Compaq says it will post a software fix on its Web site next week that will
improve the reconfiguration process to show users how to change the
three untouchable buttons. But novices aren't likely to locate, download
and install such a "patch," and Compaq doesn't plan to build the feature
into any new machines until the fall.

Compaq officials insist they now want users to have choices, and that the
change in course just couldn't be smoothly implemented before the new
Presarios hit the stores. I see no reason to doubt them. Even Microsoft
has made its desktop marketing icons less prominent and easier to delete,
albeit under pressure.

But ultimately the computer industry is going to have to decide whether its
hardware and operating systems are revenue producers on their own, or
merely tools for bringing in fees from on-line services. If they're going to
keep charging people big bucks for the machines, they shouldn't try to turn
them into mere conduits for on-line marketing. If they want to sell services
instead of products, they should slash prices deeply, or even give the PCs
away, on the model used by the cellular-phone systems, which make
phones cheap in order to woo more service users. I don't think the
computer companies can have it both ways.

For answers to your computer questions, see my Mossberg's
Mailbox column in Tech Center.
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