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HP trims Unix boxes

Competition from personal workstations running Windows NT compels HP to cut the price on its Unix-based boxes. A manufacturing reorganization allows it.

Customers in the market for workstations are starting to reap the benefits of increased competition.

Hewlett-Packard(HWP) announced today price cuts of up to 41 percent on its Unix-based mid-range and high-end workstations, which are used in fields such as engineering, science, and multimedia content creation.

"Personal workstations"--which commonly use Intel Pentium Pro processors and run Windows NT--shipped by companies such as Compaq and even Hewlett-Packard itself have started to eat away at the dominance of the Unix systems using RISC processors such as HP's PA-7300LC.

Unix systems have traditionally been more costly than Pentium Pro-based systems, although competition on the low end of the workstation market has had a ripple effect on pricing throughout product lines from vendors such as Sun Microsystems, currently the largest vendor of Unix workstations.

HP's price cuts are the result of recent organizational moves, officials say.

"We consolidated two operations for cost relief [last November.] We also recently announced that we've adopted more of a PC manufacturing model," says Jan Silverman, director of business development for HP's Technical Computing unit. "The traditional model for workstations was that you built the whole thing yourself. The PC manufacturing model is where you outsource a lot of assembly and manufacturing of components to get the cost structure down."

As a result, HP is able to cut prices across its entire Visualize line of Unix workstations. For instance, the HP Visualize B132L with HP Visualize-24 3D graphics has been reduced in price from $17,700 to $12,995, a reduction of 41 percent. The Visualize C180 with HP Visualize-24 3D graphics was priced at $38,000 but is now priced at $25,995, a 32 percent reduction. Dual processor workstations are also getting price cuts; the Visualize J210XC with Visualize EG graphics was reduced in price from $32,000 to $19,995, a 37 percent reduction.

Not only are systems prices being reduced, 3D graphics systems and system memory prices are being discounted up to 25 percent, and mass storage systems for PA-RISC workstations will get price cuts up to 11 percent.

HP says the price cuts aren't so much intended to make Unix workstations more competitive with NT-based products--which the company also sells--but to give them an overall price/performance advantage relative to other Unix vendors like Sun and SGI.

"We are basically repricing for best performance at specific price points," says Silverman. "We don't have to price to Windows NT because we have NT systems. We want to be aggresive against other Unix vendors," he notes.