IBM to phase out NetVista X

Despite winning BusinessWeek's International Design Excellence Award and other accolades for its NetVista X Series, IBM will retire the all-in-one PC after only two years on the market.

The desktop, which combined a PC and a 15- or 17-inch flat-panel display into a compact package that could be mounted on a swinging crane arm, at one time symbolized the company's effort to revitalize its PC business through elegance and industrial design.

But with IBM's focus shifting toward reducing costs and concentrating on differentiating its PCs through enhanced security features, the machine will be phased out in favor of newer models without built-in screens, IBM executives said.

The X Series "sold up to expectations, but we decided we'd get the same effect with separate components," said Fran O'Sullivan, general manager of IBM's Personal Computing Division.

Although the NetVista X was one of the most distinctive computers in years, it suffered the fate of most all-in-one computers. People didn't buy it. With the exception of Apple Computer's original iMac, most of these computers experience light sales.

Several trends conspire to limit the appeal of all-in-one PCs like the NetVista X. Most customers, especially corporate buyers, are looking for smaller, less costly PCs. All-in-one machines generally cost more to make because of their special design characteristics, analysts say.

Purchasing flexibility is also reduced because PCs can't be mixed and matched with different monitors. The X Series starts at $1,699 with a 1.6GHz Pentium 4, 128MB of RAM, a 20GB hard drive, and a CD-ROM. It incorporates a 15-inch display.

But a customer could combine the $619 T560 display with a faster $799 NetVista M Series desktop that includes a 1.8GHz Pentium 4, 128MB or RAM, and a 20GB hard drive for only $1419, a savings of $280, according to IBM's Web site.

Another problem comes in technology lifespan. Displays tend to last much longer than the PCs. A company will often keep a monitor for seven years or longer, whereas it replaces its PCs every three to four years. All in ones, therefore, raise costs because displays get turned over more rapidly.

The design of the NetVista X also created some headache particular to the product line. In early models, the way the flat panel and PC were joined made it difficult to change memory or hard drives. IBM later inserted a panel so IT managers could reach these components without performing PC surgery.

The X Series NetVista also uses a different motherboard design than IBM's NetVista A and NetVista M PCs. It's a minor design difference, but it can cause headaches for company IT managers who try to maintain the same set of software for all of their company's PCs, O'Sullivan said. A change in motherboard requires a change in system software.

Because the PC was incorporated into the back of the NetVista X, it made the balance a bit tricky, some analysts have said. In Apple's new iMac, the computer guts are located in the base of the PC, giving it more stability.

Apple is currently experiencing a surfeit of inventory of its new all-in-one flat-panel iMac, but the glut appears due largely to a slowing PC market, sources close to the company said.

Still, design ideas embodied in the NetVista X will live on in other products. Big Blue recently introduced a swinging arm-mounted 15-inch flat-panel monitor, its T560, based on technology developed for the X Series. The monitor grants the same display flexibility offered by the X Series.

IBM said it would migrate slowly to the new PC combinations. It is still selling the X Series on its Web site and will do so through the end of the year, a company representative said.

Despite the difficulty of selling all-in-one computers, companies continue to coin them. Gateway is expected to launch a Profile 4 this summer with a Pentium 4 and a 17-inch display.