Integrators wary of vendors' low-end sorties

Integrators wary of vendors' low-end sorties

Vendors selling direct to customers are posing new challenges for Australian integrators, especially when the prices vendors are offering appear to be undermining the integrators' previous advantage in this area.

One example of this occurred this week when IBM released its Aptiva EQ1-micro tower for just $1499.

Built on a low-end 233 MHz AMD processor and consisting of a 3.2GB hard disk drive, 32MB of RAM, a 24X CD-ROM drive, a 15 inch monitor, K56flex modem the product also includes Lotus SmartSuite.

IBM is hoping to target the dual market of small business and home uses.

Chris Dimmock, the director of sales and marketing at Genitech, recognises the encroachment that this product has on the market he operates in but does not perceive it as a death knoll for local systems integrators.

"Genitech operates in the high-end service-based sector, so we're focusing on a different market. Multinationals put all of their good stuff in their higher range of products that are obviously more expensive. So assemblers can still compete by offering a higher end product cheaper than the vendors can."

However, IBM's offering is the first of many, according to Bernie Esner, IDC Australia's senior PC analyst. He claimed that PC and systems assemblers might find it more and more difficult to maintain their positions in the market.

"In effect, IBM is the first vendor to market with a Christmas special and it can be expected to have a domino effect that will drive down the prices of the other international desktop players".

Esner is anticipating that IBM's limited offer will set a precedent of involvement for the vendors in an area that was traditionally the realm of the systems integrator.

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