IBM May Have Others Make Its PCs, Analyst Says
Armonk, New York, March 31 (Bloomberg) -- International Business Machines Corp., the No. 1 computer maker, is considering hiring companies in Europe and Asia to make and sell its personal computers to reduce costs, according to an analyst.
The companies would make and market IBM-branded PCs, paying IBM a 6 percent royalty, said Merrill Lynch analyst Steve Milunovich in a report. IBM has a similar agreement with Metro AG's Vobis in Germany, Milunovich wrote. IBM declined to comment.
IBM has used other companies to make its PCs since it broke into the personal computer business in the early 1980s. Acer Inc. already makes IBM's Aptiva consumer machines. Analysts have speculated that IBM will try to reduce costs after its PC business lost $992 million before taxes last year.
''If true, this would show IBM is working on reducing its losses,'' Milunovich said in his report.
IBM fell 1 1/16 to 177 1/2.
16:36:14 03/31/1999
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