Toshiba lays into laptop prices

The slew of pricing actions, coupled with the introduction of the new notebooks, indicates the company is serious about taking the necessary, if painful steps toward trying to maintain its market position, analysts say.

Hoping to set the pace for price-performance, the Japanese company introduced a new Satellite model with Intel's fastest notebook processor, the 300-MHz Pentium II, and a large, high-quality display for under $3,000.

Toshiba also discounted 22 notebook models today, in cuts that were wide as well as deep. The Tecra 750 CDM, with a 233-MHz MMX processor, a 4.7GB hard drive, and 13.1-inch active-matrix display, was slashed by more than $2,000, from $4,999 to $2,799.

Toshiba regained the top position in terms of market share last quarter, according to market research firm International Data Corporation, after ceding the top slot to Compaq in the first quarter as it dealt with lingering inventory issues in the distribution channel.

"Toshiba has suffered over the past year from a steadily declining notebook share, due to aggressive marketing and product introductions from Compaq, IBM, and Dell," said Gerry Purdy, an analyst at Mobile Insights who noted that although manufacturers routinely cut prices as product lines are refreshed, today's discounts are "extraordinary measures to take."

Introduced today, the Satellite 4020 CDT, with a 300-MHz Pentium II processor, a 6.4GB hard drive, and 13.3-inch active-matrix LCD screen, will have an estimated retail price of $2,999. (Click here for detailed specifications).

When first introduced earlier this summer, Pentium II notebooks with Intel's fastest processor were priced in the $4,000 to $5,000 range.

Toshiba's Satellite 4010 and 4020, which feature Pentium II processors for notebooks, start at $1,999. These aggressively priced systems "show that customers are being much more selective," Purdy said. "Today, it takes a larger price delta to switch people from one brand to another."

The Satellite 4010 series, targeted at small businesses and home office users, features the 266-MHz Pentium II processor. The Satellite 4010 CDS, which has a 12.1-inch dual-scan display, will retail for $1,999. The 4010 CDT, which offers a higher-quality 12.1 inch active matrix display, will have an estimated retail price of $2,229.

"We expect that Toshiba will continue to take the actions necessary to retain their position in the marketplace," Purdy said.

Other price cuts were deep. The Satellite 335 CDS, with 266-MHz MMX processor, 32MB of memory, 4.1GB hard drive, and 12.1 inch dual-scan display, was discounted by 11.8 percent, bringing the consumer notebook to $1,499.

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