Internet bundles losing appeal

Internet bundles losing appeal

The bundled PC and Internet packages, being offered by both the major retailers like Myer-Grace Bros, Dick Smith, Harvey Norman and Tandy and many smaller resellers, appear to have gone off the boil.

Talking to ARN, David Jones computer buying manager Tim Quinn expressed some concerns about the bundle concept. Quinn said that in the initial rush a couple of months ago they had trouble keeping up with demand, but the numbers were not of the scale he had heard reported by other major retailers.

And the Big Net Set offered by Myer/Grace Bros, which includes a special model of Hewlett-Packard Pavilion (4411) and Internet access through Optus for a 36 month-commitment, has reportedly left a large stock of unsold PCs for the pre-Christmas sales.

"People are cynical," Quinn said. "Look at mobile phones. No one believes they are only $1."

A source close to Harvey Norman revealed that after the excitement and early reports of retailers doing phenomenal sales figures (in the thousands-per-month range), the actual sales of its "zero dollar PC" were much less. But the promotion had been a good traffic generator to the store, the source said. Many buyers who came into HN were upsold to other PC bundles.

And according to industry analysts, there has been a flurry of PC sales in recent months - largely influenced by the major retailers - but the so-called chameleon PC bubble appears to have burst.

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