Bearded One: Here is an article which might be of some interest to you and thread.(lifted from cpq thread)
December 8, 1997 (New York Times)
Many PC Buyers Prefer Power to Low Price
By JOHN MARKOFF
SAN FRANCISCO - The ballyhooed sub-$1,000 personal computer could prove to be a disappointment for the computer industry this holiday season, according to a recent survey of consumers.
While the inexpensive machines were the talk of the industry at the Comdex computer show in Las Vegas last month, a report to be issued Monday by Odyssey LP, a market research firm based in San Francisco, suggests that potential PC buyers may be more interested in power than in price.
The report, based on a national telephone survey conducted in late October and early November, indicated that 69 percent of consumers would choose the latest technology over a lower-cost, less sophisticated computer.
Moreover, among consumers who are most likely to buy a computer in the next six months, the preference for performance is even greater, rising to 77 percent.
"If the under-$1,000 PC ends up representing 40 to 60 percent of PC sales this Christmas, I don't see how the industry is going to make up for lost profitability," said Nick Donatiello, Odyssey's president. "It's pretty bad news."
According to the report, members of roughly one in 10 households say they are extremely likely to buy a personal computer in the next six months. Of that group, 78 percent thought they would pay more than $1,000, and 45 percent, more than $2,000.
The report also found there was a slim difference in price expectations between those who already have a personal computer and those who plan to buy their first machine. Current PC owners expect, on average, to spend $1,999 and first-time buyers expect to spend $1,853, the report said.
Still, computer-industry analysts say they foresee a strong holiday shopping season, even with the advent of the sub-$1,000 personal computer.
"The easy answer is that we are expecting strong sales," said Scott Miller, a senior industry analyst at Dataquest, a market research firm based in
San Jose, Calif. He conceded, though, that "the price declines are ahead
of where we thought they would be."
The $1,000 figure does not include the cost of a monitor. Dataquest,
using a slightly higher price category, forecasts that machines costing less than $1,200, with a monitor, will capture about 30 percent of the U.S.computer market in 1997. It also forecasts that he home computer market in the United States will grow more than 20 percent.
Despite the projected growth, it may still be a difficult time for he PC industry, analysts said.
"All of the actual data say that the sub-$1,000 machines are not really bringing that many new users into the market," said Seymour errin, an industry consultant with Merrin Information Services in Palo Alto, Calif.He said the industry might be simply chasing the latest trend.
"This is an unbelievably faddish industry," he added. |
