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US price cuts likely to flow on

US price cuts likely to flow on

Prepare yourselves for another round of price cuts on PCs as US vendors take the razor to their price lists.

HP locally has already announced cuts on its Vectra family of PCs of up to 24 per cent, while the pricing of HP PC workstations has also been reduced by up to 21 per cent.

Rob Hartnett, HP Australia's market development manager for corporate PCs, said in a statement released by the company that the pricing initiative signals an aggressive second half push by HP.

Watching with interest is IBM. Following price cuts in the US, IBM Australia would only say it is monitoring prices locally to ensure it remains competitive.

In the US, IBM has cut prices in both its desktop and notebook lines. Effective immediately, Big Blue dropped prices there by approximately 20 per cent on select 300 GL desktop models. The PC 300 GL series will now start at about $US989, depending on configuration.

Taking the cuts a step further, IBM has also reduced prices by as much as 20 per cent across its ThinkPad line. The price cuts were made to remain competitive and to make room for forthcoming products due in the next few months, company officials said.

Another company to cut prices in the US was NEC. According to Andrew Sleight, product manager for servers, NEC Australia will join in the price slashing of PCs when its competitors "come down to a reasonable price point.

"NEC is constantly priced below Compaq and HP so we aren't doing any drastic price reductions other than our normal monthly price review," Sleight said. "Yes, we would come down in price as the other vendors do so, but it's not a strategy we have. It's just that we have always priced below them," he added.

Compaq last week added new models to its Deskpro line of corporate PCs, available now. At the same time it announced price cuts in the US as large as 22 per cent on existing desktop PCs, bringing the price of a low-end model below $US1000.

Analysts in the US expect further price cuts as vendors tackle the direct sales models of Dell and Gateway 2000.


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