Notebooks smash the $2,000 barrier

TORONTO — All of the major notebook OEMs have released mobile machines in the sub-$2,000 price bracket this year for the consumer market, the most recent arrival being Compaq Computer Corp.

Compaq will deliver two consumer notebooks to the retail market on Thursday in advance of the December spending season: the Presario 700 for $1,799 and the Presario 2700 for $2,799.

“I think we’re breaking through the psychological price point,” said Ken Price, manager of product marketing for Compaq Canada Inc., based in Richmond Hill, Ont. He added there will be no mail-in rebate program for customers. Compaq has “been playing along with the sleight of hand game” of rebates. “Frankly, that’s all gone. The price is the price.”

Toshiba, which shipped several $2,000-and-under notebooks last month, is still head and shoulders above its competition in notebook sales, according to IDC Canada Ltd. The research firm’s report on third-quarter shipments indicates Toshiba owns approximately 30 per cent of the market, followed by Apple’s iBook and Compaq. Apple moved up in the rankings by selling widely to the education market, said PC analyst for IDC Canada John Stanisic. Even Apple, traditionally more expensive than its Wintel competition, has an entry-level notebook for $1,999.

“2001 is actually the first year we’ve started to see a low-end notebook market,” said Stanisic. “This is the first year when it hasn’t been difficult to find pretty decent notebook computers that were shipping with prices around $1,500 to $1,700.”

Overall, notebook shipments are up 40 per cent over the third quarter of last year, said Stanisic. The drop in prices is making notebooks more attractive to Canadian consumers — those looking to add to the PCs they already own or to replace a PC altogether. The price difference between PCs and notebooks has been shrinking, but so has the performance gap, said Stanisic, making notebooks more viable as PC replacements.

Compaq’s Presario 700 ships with an AMD Duron 900 MHz processor, 256 MB of DRAM, 20 GB hard drive and a DVD-ROM drive. The 2700 ships with a Pentium III 1.0 GHz processor, 256 MB of DRAM, 20 GB hard drive, a DVD-ROM drive and a CD-RW drive. Compaq will also ship a light-weight Presario 1715 for the business user, which will sell for $2,499.

The falling prices of notebooks follows this year’s trend of cut-price desktops, said IDC pricing analyst Frank Albanese. Entry-level desktops are currently available for less than $1,000 from various hardware vendors. The price of notebooks may continue to fall, though, with Advanced Micro Device’s (AMD) attempt to take the wind out of Intel’s sales with two new high-speed mobile processors introduced on Monday — the 1.2 GHz Athlon 4 and the 950 MHz Duron.

“With these new AMD processors coming in, it’s really allowing them to bring those prices down and it’s putting a lot of heat on Intel,” said Albanese. “Look for these PIII mobiles to disappear and be replaced by the P4s rather quickly in order for Intel to maintain their competitive edge.”

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Jim Love, Chief Content Officer, IT World Canada

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