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Dell hopes PC buyers get LCD envy

The computer maker announces the release of its first 19-inch LCD. Will rivals IBM, Hewlett-Packard and Compaq follow suit?

! -- EDS UPDATE 4:10 pm: art change, no text changes --> Dell Computer is looking to improve PC sales with its latest monitor.

The computer maker on Tuesday announced the release of its first 19-inch LCD (liquid crystal display), the 1900FP, which is selling for $1,299.

Dell's strategy of selling flat-panel monitors is aimed at improving margins and lifting PC sales, according to Tim Rhodes, chief executive at research firm Provizio.

"It doesn't just make money for them, but it also helps to differentiate them from their competitors," Rhodes said. He added that he wouldn't be surprised to see rivals, such as IBM, Hewlett-Packard and Compaq Computer, come out with similar 19-inch flat-panel screens to attract PC sales and improve margins.

Dell's new, midnight-gray and silver flat-panel monitor is targeted at people, such as stock traders, who are looking for a sleek, low-power consuming screen.

Dell--along with Apple Computer and Gateway--has been among the early computer manufacturers to promote flat-panel displays.

LCD prices have fallen dramatically as they have picked up in popularity. In the first quarter of 2001, 15-inch displays were priced around $2,000, but recently they have dropped to below $500. Rhodes said part of the reason for the price cuts is that as unit sales picked up, manufacturing efficiencies improved, and more competitors entered the market.

As prices fell, so did margins, causing some manufacturers to start promoting high-end--and high-margin--larger-sized displays.

Recently, there has been some concern of a shortage in the LCD market, which would affect flat-panel displays and other devices such as handhelds and cell phones.

Dell product manager Scott Hardy acknowledged a shortage, but said Dell is working to head off any effects of that.