HP baits buyers with cheaper Pavilion

The PC giant this week began offering the new Pavilion Ze4100, which starts at $949. A $100 mail-in rebate drops its starting price to $849.

HP hopes to attract new notebook customers, who are increasingly swapping their desktops for laptops.

For $849, buyers--most likely consumers and small businesses--will get a 1.6GHz Intel Celeron processor, a 14.1-inch display, 128MB of RAM and a 20GB hard drive. A CD-ROM drive is also included. A floppy drive, which is not included in the price, costs $50 extra.

HP will sell the machine directly to customers and via its kiosks at retail. It will not be stocked on store shelves.

The company introduced the new system partly to remain competitive with Dell Computer and Gateway, which both sell inexpensive notebooks directly to customers, said Jonathan Kaye, manager of product marketing for Pavilion at HP.

"This enables us to compete in the direct space with guys like Dell and Gateway. But we're not looking to start a price war or anything," Kaye said. "It enables us to offer an easy transition for someone who is (moving) from a desktop to a notebook. For this price, which is about the same as a desktop, you can get a notebook, which doesn't take up as much space and is much more portable."

Price war or not, there is plenty of competition for notebooks below the $1,000 mark.

Dell's new Inspiron 2650C notebook, for example, starts at $849 before any rebates. It includes a 1.5GHz Celeron, but is otherwise the equal of the new Pavilion.

Gateway's 1450SE notebook takes a slightly different approach. It starts at $999, but includes a better allotment of standard features. Alongside its 14.1-inch screen and 1.3GHz Celeron processor it offers 256MB of RAM, a 30GB hard drive and a combination CD-Rewritable/DVD-ROM drive.

With 256MB, a 30GB hard drive and a combo drive, the Pavilion Ze4100 runs $1,119 after the rebate. A 15-inch screen, a $75 option, brings the total price to $1,275.