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  • Low-Price Computer Demand Squeezes Taiwan Makers
  • March 4, 1998 (TAIPEI) -- Unabated U.S. demand for low-priced computers is squeezing the business of Taiwan manufacturers.
    In the U.S. market, average prices of desktop and notebook PCs have dropped to US$599 and US$1,399 respectively. Acer Inc. said the move forced it to cut the price of desktops to US$799 beginning in March. In the third quarter, desktops are likely to be as cheap as US$599.

    Local makers said that in the second half of 1998, order prices for notebooks will be as low as US$1,200 to US$1,500. This, they say, will reduce the industry's profitability by one to two percentage points.

    Data collected from the U.S. market in mid-February show that prices of Compaq Computer Corp's Presario 2200 desktops and Presario 4500 notebooks have posted new lows. The Presario 2200 series was priced at only US$599, equipped with a Cyrix GXm 180MHz CPU, 16MB of memory, a 1.6GB hard disk drive, an 8x CD-ROM drive and a 33.6kbps modem.

    IBM retailed its Aptiva desktop at US$999 without a monitor. Standard features of the product include a K6 233 MMX processor made by Advanced Micro Devices Inc., 32MB of memory, a 3.2GB hard disk drive, a 24x CD- ROM drive and a 56kbps modem. Hewlett-Packard Co. offers a desktop for US$699.

    Toshiba Corp., which has traditionally adhered tightly to its high- priced strategy, also yielded to market pressure recently. The company is now offering a notebook equipped with a Pentium 133MHz MMX processor at a bargain price of only US$1,399. IBM's Think Pad notebook model, equipped with a 166MHz MMX processor, 16MB of memory and 2.1GB hard drive is retailing at US$1,899.

    A spokesman for Acer said that the U.S. market's cut-throat competition is putting pressure on local makers, which have depended heavily on U.S. consumers. Mitac International Corp. and First International Computer Inc. said they are cutting order prices. Acer and Twinhead International Corp. are taking action to develop low-priced products and trim the cost of components.

    (Commercial Times, Taiwan)

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    Updated: Tue Mar 3 16:03:12 1998