Business PC pricing trends.
stock bull:
Here is some information you might be interested in regarding pricing,
notice comments from DELL in bold.
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(source:computerworld)
Online News, 10/29/98 05:08 PM)
Businesses won't see bargain-basement PCs soon
By Kathleen Ohlson
At least for the near future, corporate customers are unlikely to see bargain-basement PCs -- with new machines priced at less than $600 -- that consumers will be able to choose from, according to vendors and one industry observer.
Today, IBM became the first major PC vendor to announce a consumer offering priced at $599. The Aptiva E D1N, which will roll out next month, will feature a proprietary 300-MHz MMX-enhanced processor, 32M byte of RAM and a 3.2G-byte hard drive, according to an IBM statement.
But despite the hoopla that's sure to surround its sub-$600 Aptiva, IBM said it doesn't have any current plans to roll out a corporate PC in that price range.
"Our $899 Celeron-based IBM PC 300GL is IBM's lowest-cost commercial desktop PC," said Ray Gorman, an IBM spokesman. He did hint, though, that lower prices could be in the offing. "With each new technology, customers have benefited from more processing power for less money, so it would be difficult for me to predict the future."
Corporate customers looking for cheaper prices will likely have to compromise on memory and performance, said Chris Goodhue, an analyst at Gartner Group Inc. in Stamford, Conn. If businesses want a fully configured, state-of-the-art PC with an Intel Corp. Pentium II chip, a monitor and peripherals, they're going to have to pay for it, he added.
Corporate PCs "run ... bloated office suites, such as Microsoft's Office Professional and Outlook," so they need to contain a Pentium II processor, 64M bytes of memory, a large hard drive and a 17-in. monitor, he said -- and that's far more than IBM packs in the machine announced today.
A spokesman for IBM competitor Dell Computer Corp. agreed that he doesn't expect to see the lower-priced consumer PC trend cross over to the corporate side soon. Lower prices won't be "a big part of corporate PCs. It's not [the] visible trend that we're seeing on the consumer side," said Ken Bissell. Pricing for Dell's OptiPlex corporate PCs, most of which pack Pentium II chips, starts at $1,638.
Corporate customers are more concerned with PC longevity than consumers are, Bissell said. They want systems that last three to four years and sport fast processors, 64M to 128M bytes of RAM and up to a 6.4G-byte hard drive, he said. And they're willing to pay for that.
They also want to know "how long the system is viable. They want to buy [PCs] with richer configurations to run today's applications and operating systems -- and the future's," Bissell added. Business users must also keep in mind next year's release of Windows 2000, Microsoft Corp.'s 5.0 version of the NT platform, Bissell said, which will require more system resources.
In the next six to 12 months, corporate PC buyers can expect to see a push for PCs priced under $1,000, Goodhue said. "But I don't see them breaking the $600 barrier anytime soon."
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