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HP PCs break $950 mark

Hewlett-Packard, aiming to put the heat on arch-rival Compaq Computer, cuts PC prices up to 23 percent, dropping Pentium desktops below $950 for the first time.

Hewlett-Packard (HWP) aiming to put the heat on arch-rival Compaq Computer (CPQ) announced today that its 120- and 133-MHz Pentium business desktops will sink below $950 in price for the first time. Price cuts range up to 23 percent.

Compaq and Hewlett-Packard traditionally engage in tit-for-tat price slashing battles since both companies compete ferociously for business PC customers. Compaq recently introduced price cuts of up to 17 percent on many of its business PCs.

Hewlett-Packard (HP) claims that its 120-MHz and 133-MHz PCs are now priced at approximately nine percent less than Compaq's 120-MHz and 133-MHz Deskpro systems. HP bases this claim on an International Data Corp. pricing database.

An entry-level HP Vectra VE PC, configured with a 120-MHz Pentium processor, a 1GB hard disk drive, and 8MB of RAM is now expected to start at $931, according to the company. It was $1,056.

A Vectra VL 5/166 with a 166-MHz Pentium processor a 1.2GB hard disk drive, 16MB of RAM, and 256K of cache memory will fall in price to $1,253 from $1,504, a decrease of 17 percent.

Pentium Pro models will also get price cuts. A Vectra VA 6/200 packing a 200-MHz Pentium Pro processor, a 2.5GB hard disk drive, 32MB of RAM, and an 8X CD-ROM drive will drop to $2,328 from $2,588, a decrease of ten percent.

By comparison, Compaq recently lowered prices from 6 to 17 percent on all Deskpro 2000, 4000, and 6000 business PCs. The Deskpro 2000, for example, is now priced as low as $1,150, a drop of 16 percent. It uses a Pentium 133-MHz processor and a 1.2GB hard disk drive. The Deskpro 4000 models now start at $1,290, or 15 percent less, with a 133-MHz Pentium processor and a 1GB hard disk drive.