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PowerBook prices to drop

Apple is expected to cut prices on PowerBook 3400s by up to $600, according to some resellers.

Apple Computer (AAPL) is expected to cut prices on PowerBook 3400s, according to some resellers, as Apple pushes to aggressively compete with Intel-based notebooks in both price and performance.

Prices are expected to drop on Apple's top-line notebook by $400 to $600 on each of the models, according to industry sources. Currently, the PowerBook 3400s come with the 180-, 200- or 240-MHz 603e PowerPC processor and are priced between $4,500 and $6,500.

The price cuts on the 3400s follow last month's reductions on the PowerBook 1400 series notebooks by up to 32 percent. Apple notebooks have been regarded as expensive in the past, but the company is now making room for aggressively priced notebooks at the low end.

The Mac notebook market could also get cheaper and acquire more features with the anticipated entrance of Mac clone vendors such as Umax, Power Computing, and Motorola into the market. Umax, in particular, is known for being able to produce low-cost computers, having recently introduced the first sub-$1,000 Mac system.

The companies are interested in producing a notebook based on the Common Hardware Reference Design (CHRP), which is now referred to as the PPCP specification. CHRP is intended to provide an open standard for PowerPC system designs that use industry-standard components.

PowerBooks now run on a number of specially designed chips used only by Apple. Any notebook clones would need to license the hardware design, as well as a special version of the Mac OS operating system.

With CHRP, however, clone vendors could design a notebook without licensing the PowerBook designs. By using more industry-standard components found in Intel-based notebooks, supply of parts would not be as constrained and component cost in general would result in less-expensive Mac notebook clones.

"We believe there is certainly a market for a portable product, and we believe we've got some expertise in that area...but we think it's not likely to appear until 1998," said Phil Pompa, vice president of marketing for Umax Computer, in an earlier interview with CNET's NEWS.COM.

So far, Apple has not stated its position on the possible CHRP-based close notebooks. The company may decide to protect its own profitable notebook sales by refusing to license needed technology to the clone vendors.

The Apple price cuts could presage the introduction of an even faster PowerBook 3400, which is now available with a 240-Mhz processor. Apple currently has the upper hand in performance against Intel-based notebook makers and is expected to widen that gap in the near future. The fastest notebook from an Intel-based manufacturer such as IBM and Compaq Computer runs at 166-MHz.

Apple representatives have said that the PowerBook 3400s have been engineered to accept processors that exceed even the 240-MHz speed. Motorola's semiconductor division is producing 603e PowerPC processors in 250-, 275-, and 300-MHz versions that could be used in the 3400, but Apple has declined to state when such a model might be introduced.