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Sony aims to blanket the market

Sony, a bit player on the desktop computer stage, wants a leading role as it introduces its first PC near the $1,000 mark and expands sales efforts.

Sony, a bit player on the desktop computer stage, wants a leading role as it introduces its first PC near the $1,000 mark and expands efforts for selling direct to small and medium-sized businesses.

Sony introduced new desktop and notebook PCs this week, including a 466-MHz Celeron desktop that will be priced at $1,099, the lowest-priced system the company has yet offered in the U.S. market.

Another first for the company: It's reaching out to small and medium-sized businesses with an expanded direct sales operation, to be called Sony Business Direct. These customers will now be able to order online through a secure "extranet" site, as well as through a dedicated telephone sales force and field sales representatives.

These latest moves clearly signify that Sony, despite an uneven history in selling desktops into the U.S. market, is in for the long haul and will adjust its marketing and product plans accordingly. Many other PC companies already offer such programs to businesses, and, of course, low-priced PCs. The change is that Sony is now joining them.

"Sony has always been a vendor that tries to set itself apart [on features], rather than price," a strategy which has not been particularly successful to date, said Cameron Duncan, an analyst with market research firm ARS. But with its cheaper computers, Sony may make some inroads in consumer electronics stores--even those that recently dropped the company from store shelves.

A rocky history
In the past, the company focused on connecting audio/visual peripherals to its computers, which relegated the company to selling high-priced computers, a portion of the market that is shrinking. The average price of a PC at retail stores is now around $928, according to recent research from PC Data. Sony is coming closer to the sweet spot of the market with its $1,099 PCV-R522DS.

The company has already had its largest success with notebooks, and is hoping its latest laptops achieve similar results.

"Sony, in the desktop business, is not so great. But the notebooks have been selling really well,' said Stephen Baker, senior hardware analyst with PC Data. Baker noted that Sony accounted for 11.5 percent of retail notebook sales in the month of April.

To its ultraportable line, Sony has added features such as a larger keyboard, larger hard disk drives, built-in Ethernet networking, and a 12.1-inch display, while keeping the weight of the systems at under 3.5 pounds. The Z505S with a 333-MHz Celeron processor and 64MB of memory will be priced at $2,499, while a system with a 366-MHz Pentium II and 128 MB of memory will be priced at $2,999.

Sony's mainstream notebook lineup will now include a system with a 15-inch LCD display, a feature which is currently only offered in notebooks by Dell Computer and Gateway. The price of the system, which weighs 7 pounds in spite of the large screen, has yet to be determined, and is expected to be available in July. The company is offering other notebooks in the PCG series priced from $1,699 to $2,799; those systems are expected to be available in June, according to Sony.

As for its desktop PCs, the $1,099 PCV-R522DS system includes a 10GB hard disk drive, 64MB of memory, a CD-ROM drive, video editing software, IEEE 1394 connector for hooking up digital cameras and other peripherals, and built-in modem. A system with 450-MHz Pentium III is priced at $1,599, and a system that has both a DVD-ROM and re-recordable CD-ROM drive is priced at $2,199. The desktop systems will be available in June, Sony said.

New leasing programs
To further accommodate customers buying in quantity through the Business Direct program, Sony is now offering new leasing programs. One program lets customers return computers in exchange for fair market value after a lease expires, or they can lease-to-own. Sony is also adding accounts for open purchase orders, whereas before customers had to purchase equipment with their own credit cards. That inhibited sales to smaller corporations, a spokesperson said.

In conjunction with the new program, certain models of desktop PCs can be custom configured for buyers. Sony notebooks were already available on a build-to-order basis.

Eventually, the circle may come back to the beginning, mused Duncan. Consumers may prove receptive to buying a PC bundled with other consumer electronics products. The new Sony desktop systems seem well-aimed at consumer electronics stores, where the computers can be displayed with other audio-visual products such as digital camcorders. Stores could prove receptive to the idea as profit margins on PCs themselves continue to shrink.