eMachines back in the notebook race

The low-price PC maker on Tuesday launched its first portable PC, dubbed the M5305, since a management buyout took the company private in late 2001. eMachines expects the new notebook to boost its presence in the consumer PC market beyond its traditional niche of selling desktops priced under $1,000.

The new 6.5-pound M5305 boasts a 15.4-inch wide-screen monitor with a resolution of 1280 by 800 pixels and an Advanced Micro Devices Athlon XP-M 2200+ processor. Wide screens have so far been seen only in more expensive notebooks, priced in the $1,500 to $2,000 range. The new eMachines model carries a suggested retail price of $1,249, the company said, but it is expected to sell for less than $1,200 at some retail outlets.

The lower price will allow eMachines to attack the hottest segment of the retail market for notebooks in the United States--notebooks priced at $1,200 or less--without delving too deeply into the cutthroat sub-$1,000 category, eMachines executives explained.

eMachines sold a low-price notebook, the eSlate, back in 2000. But the $999 machine never caught on and didn't offer enough features, according to the company's current management.

The new model gives eMachines room to deliver notebooks at both higher and lower prices in the future, said Gary Elsasser, vice president of engineering and product development for eMachines.

"We wanted something that's was differentiated--wide screen takes care of that--that would also be attractive to high-volume retail customers," he said. "I think in the future, we'll offer lower-cost units. If anybody can build a profitable box at a low price point, it's us."

eMachines will have stiff competition from the likes of Hewlett-Packard, Sony and Toshiba in the U.S. retail market and Dell Computer in the wider market for consumer PCs. Dell's Inspiron 8500 notebook offers a choice between two higher-resolution 15.4-inch wide screens. Its starting price is about $1,500.

eMachines plans to continue expanding its product line. The company also has been working on a line of flat-panel displays, offering a 15-inch flat panel in PC bundles on a limited basis for Wal-Mart stores. But eMachines is not expecting to offer flat panels until later in the year, due to price fluctuations on LCD (liquid-crystal display) screens, Elsasser said.

Meanwhile, the company is working on several other notebook models. Its next offering, a desktop replacement notebook with a 16-inch screen, will come out later this quarter, Elsasser said.

Aside from its wide screen and Athlon processor, the M5305 incorporates 512MB of RAM, a 40GB hard drive, a combination CD burner/DVD-ROM drive and three USB (universal serial bus) ports. The machine uses ATI Technologies' Radeon IGP chipset, relying on its built-in graphics processor.

The notebook is available at Costco Wholesale and Circuit City stores. eMachines also will sell it directly to customers online.