Fast on the heels of massive price cuts announced yesterday by Compaq, Digital Equipment has slashed prices on desktops and is scheduled to announce similar price reductions for its server line today. Hewlett-Packard has also instituted price cuts on its server line.
Digital cut prices up to 26 percent for selected models in its Celebris GL 590 slimline models and up to 19 percent for the Venturis commercial desktops. In addition to the price cuts for its corporate desktop line, Digital will also announce reductions today for its Prioris servers. Price changes are effective immediately.
Meanwhile, Hewlett-Packard announced aggressive price cuts of up to 21 percent across its entire HP NetServer Series of PC servers, including the LS, LH, and LC series.
Analysts weren't surprised by the reductions, saying that once one PC vendor cuts prices, the others are bound to follow.
"One-upmanship is pretty pervasive throughout the industry," said Jim Beedle, an analyst at In-Stat, a marketing research firm.
The price cuts from all three companies reflect recent reductions for Intel processors, a 30 percent average drop in DRAM memory chip prices over the last few months, and the downward spiral of quad-speed CD-ROM drives, Beedle said.