IBM lightens load with new ThinkPads

Big Blue today completed the overhaul of its ThinkPad portable line with the introduction of the X series, in a move first reported by CNET News.com. The 3.1-pound, ultralight notebooks of the X series complement the T, A and i series models already available.

The ThinkPad product line is one of IBM's most successful ever but has suffered, as the company's PC division has grappled with larger problems involving costs and the supply chain. The division lost nearly $1 billion in 1998, but aggressive cost cutting and revamping of products reduced losses to $69 million in the second quarter of this year and has brought the division near the break-even point.

The ThinkPad line has had its share of revamping. On Thursday, for example, IBM showed off the i Series 1300, which features integrated wireless networking for connecting to computer networks and the Internet.

In May, Armonk, N.Y.-based IBM replaced the ThinkPad 600 with the T, as in thin-and-light, series, and the 390 and 770 models with the A, or all-in-one, series.

IBM's larger misfortunes had limited the ThinkPad to a bit role in the worldwide notebook market, according to market researcher Dataquest. Dell Computer led the market in the second quarter, with 21.5 percent market share, followed by Compaq Computer at 16.6 percent and Toshiba at 13.4 percent. IBM placed fourth at 12.1 percent, followed by Hewlett-Packard at 5.8 percent.

But since the launch of A and T ThinkPad models, IBM has picked up momentum in the lucrative corporate market. In July, IBM had a 44.6 percent market share through corporate dealers selling to Fortune 500 companies, double that of second-ranked Toshiba, according to NPD Intelect.

That score marked a huge jump for IBM. In May, it had only a 28.9 percent share through corporate dealers, compared with 24.85 percent for Toshiba and 24.5 for Compaq.

One analyst sees the retooling of the ThinkPad line, along with other changes such as reducing supply-chain costs, as a sign that IBM's PC division will be profitable for the year. "This is an important product transition for IBM," said Technology Business Research analyst Bob Sutherland.

The X series replaces ThinkPad 240 and 570 portables, which will be retired. The first model, the X20, goes on sale tomorrow at prices ranging from $2,199 to $3,099. The notebooks will come with 500-MHz and faster Celeron and Pentium III processors, a 12.1-inch TFT display, at least 64MB of RAM, a 56-kbps (kilobits per second) modem and an NIC (network interface card).

At 3.1 pounds, the X20 is one of the lightest portables on the market. As with the T and A models, IBM cut the weight using a titanium-reinforced casing.

IBM offers eight configurations, with the high-end model packing a 600-MHz Pentium III processor, 128MB of RAM and 20GB hard drive. Celeron models come with a 10GB hard drive.

IBM this year is offering more products--including the X series--through direct sales. X20 models ordered on the Web will cost less than those purchased through dealers. The high-end model, for example, is $2,999 on the Web, compared with $3,099 through dealers.

The timing of the release is crucial for IBM as competition heats up in the ultraportables market. IBM's ThinkPad 240 and 570 models hit the high and low ends of that market in terms of weight and features, but neither matched more middle-ground offerings from rivals Compaq, Sony or Toshiba.

Compaq's slender, 3.2-pound Armada M300 packs more features for the price than the ThinkPad X20. Compaq sells nine M300 models, with two of the most popular configurations packing either a 500-MHz or 600-MHz Pentium III processor, 64MB of memory, 12GB hard drive, 56-kbps modem and NIC. The speedier model comes with a 12.1-inch TFT display and costs $2,699, while its $2,499 kin packs an 11.3-inch TFT display.

While the ThinkPad X20 in many ways matches what Compaq offers, in one crucial way it exceeds Toshiba's Tectra 3440CT. At 3.4 pounds and packing a similar processor and other features, Toshiba's $2,499 portable offers a smaller, 11.3-inch display.

The timing of the new product launch carries some dangers for IBM. ThinkPad general manager Adalio Sanchez has moved on to take charge of manufacturing for IBM's PC division.

A bigger problem is IBM's launching the new model in the middle of a supply crunch. Shortages of a single component used on ThinkPad and Netfinity server motherboards during the second quarter cost the computer manufacturer $250 million in lost sales.

While the Netfinity crisis has abated for the most part, ThinkPads are still fairly tough to find. Back orders for ThinkPads have lessened, but many models are still hard to come by.