Tech Industry

Compaq revamps corporate line

The PC giant gives its Deskpro products a makeover to better target different kinds of business buyers.

Compaq Computer (CPQ) is renaming its Deskpro line of corporate computers as part of an effort to better target different kinds of business buyers.

Also today, the Houston-based PC giant cut prices by as much as 25 percent on selected corporate models in an effort to clear out the inventory that has hampered the company's financial position this quarter.

Under the new naming scheme, Compaq will market a Deskpro EN line, which will consist of computers that do not change much over a given year, and a Deskpro EP line, comprising systems that change with the release of new or better components, said Michael Takemura, product marketing manager for Compaq.

Differentiating computers by component consistency, versus speed or price, is a growing trend within the industry, Takemura said, echoing others. Currently, the Deskpro lines are classified by price and features. Deskpro 2000s, for instance, cost less than the Deskpro 4000s or 6000s and typically have slower processors and less memory.

By contrast, the EN and EP Deskpros will span the gamut of price points and processor speeds. What makes the two lines different is the fact that the hard drives, memory, and other components in the EN models will not change over 10 to 12 months. Consistent configurations are designed to cut down on acquisition costs, he said.

In other words, EN Deskpros will be stable, giving a corporate IT manager the security of knowing that computers ordered in April will be identical to those ordered in December. "The big decision is whether to include a NIC card (network card) or not," he said.

EP Deskpros, on the other hand, will seek to optimize price/performance characteristics.

The new Deskpros will be announced this coming Wednesday with the launch of Intel's latest Pentium II chips. Products will start to roll out over the next 60 days, he said.

Other vendors have started similar programs. Earlier this year, Hewlett-Packard quietly started a program with its notebook computers that effectively ensures corporate buyers that the configuration will not change over the course of a year, sources at that company have said.

Compaq itself has been doing it by default with certain Deskpro models, Takemura added.

Earlier today, Compaq cut prices by between 6 and 11 percent on its value-priced Deskpro 2000 computers, with prices starting at $1,119.

Compaq's Deskpro 5166X/2100 model, which includes a 166-MHz Pentium MMX chip, 2.1GB hard drive, 16MB of memory, and a monitor, will sell for $1,119, a spokeswoman said. Compaq also cut prices on its midrange Deskpro 4000 line, with the price for one model, the 6333X/3200/CDS, reduced by 25 percent. That model will now sell for $1,819, down from $2,439. It comes with a 333-MHz Pentium II chip, a 3.2GB hard drive, and 32MB of memory but not monitor. Prices were reduced by between 14 percent and 19 percent on every model in the company's high-end Deskpro 6000 line, Compaq said.

Reuters contributed to this report.