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Compaq cuts server prices

Compaq lower prices by as much as 18 percent on selected models.

Compaq Computer (CPQ) cut server prices from 6 to 18 percent today as a follow-up to its introduction of new models last week.

The price cuts are aimed at cementing Compaq's No. 1 position in the Windows NT-based server market, a lead which the company claims grew by two points last quarter.

Five ProSignia and ProLiant servers were discounted in the price action, which cut as much as $900 off of the suggested retail price of some models.

The ProSignia 200, a 233-MHz Pentium II workgroup server, was reduced from $1,960 to $1,761, a 10 percent discount. The ProLiant 850R, a departmental server which uses a 200-MHz Pentium Pro processor, was cut from $3,409 to $3,068, a 10 percent discount. Likewise, the ProLiant 800, a 200-MHz Pentium Pro server, was cut 10 percent, from $2,386 to $2,159.

Further up the server food chain, the ProLiant 2500, a 200-MHz Pentium Pro Server, was reduced from $5,682 to $4,659, an 18 percent discount. Meanwhile, the enterprise-class ProLiant 6000, a 200-MHz Pentium Pro server and one of Compaq's more powerful servers, was reduced from $10,798 to $10,170, a 6 percent discount.

"Compaq continues to deliver on our goal of providing customers with the industry's broadest selection of standards-based servers at the lowest total cost of ownership," said Jim Schraith, Compaq's vice president and general manager, North America, in a prepared statement. "We are taking every opportunity to provide superior products that offer customers the lowest risk and greatest value for their investment dollar."

The price cuts follow the introduction last week of four new ProLiant models. The new models are the ProLiant 5500, 3000, 1600, and 1200. These servers for the first time adopt Compaq's "Highly Parallel System Architecture" technology, said John Young, director of product marketing and business operations at Compaq.

Highly Parallel System Architecture allows the computer maker to incorporate two independent PCI "buses"--a bus is a high-speed data path in a computer--to eliminate data bottlenecks between peripherals such as hard drives and the system's memory and processor. The architecture also includes two memory controllers.

Other features offered by the new servers include PCI "hot plug" technology, which allows users to swap out drives, power supplies, and other parts while the server is still live.