HP trots out the $249 desktop

Hewlett-Packard is currently selling two home PCs that, after rebate, cost less than a rear-bag lawn mower at Sears.

Hewlett-Packard is currently selling two home PCs that, after rebate, cost less than a rear-bag lawn mower at Sears.

Basic configurations of the Pavilion a1030e and a1000y can now be ordered for $249, after a $50 rebate. The a1030e comes with a Sempron 3000+ processor (1.8GHz), a 40GB hard drive and 256MB of memory. The other model is similar but comes with an Intel Celeron chip.

The PCs do not come with monitors. However, consumers who buy a 15-inch flat panel monitor and customize their PCs by adding more memory or upgrading some other feature get an automatic upgrade to a 17-inch flat panel monitor, a $50 discount.

Price declines are an ordinary part of the PC world. Because chips and other components steadily improve in performance, there is always a steady supply of once-cutting-edge components floating around the industry that computer makers can buy to fashion budget offerings.

In the past few months, PC makers have been trying to low-ball each other with $399 desktops. (In 1997, Compaq Computer rocked the consumer market with the first sub-$1,000 desktop from a major label. Now, buying a $999 desktop takes some effort.)

Notebooks are getting cuts too. Last month, for instance, HP and Acer trotted out , a new low-water mark for major PC makers. In the past, only second-tier manufacturers offered laptops at this price, and even then they didn't include Windows.

More notebooks at this price range are expected to arrive during the back-to-school period in September, said Stephen Baker, an analyst at NPD Group.

"Back to school looks to be big. It will probably surpass 2003," he said in a recent interview.

HP has particular motivations to cut prices. The company's fiscal quarter ends at the end of the month and it has been losing market share to Dell.

Featured Video