Dell Slashing Prices on Servers, PCs

By Jeffrey Burt  |  Posted 2003-08-20 Print this article Print

The company is cutting server prices by 10 percent on rack-mounted systems and by as much as 22 percent on its four-way PowerEdge 6600.

Dell Inc. this week is slashing prices on some computers, servers and consumer items. The Round Rock, Texas, company announced Wednesday that it is cutting server prices by 10 percent on rack-mounted systems and by as much as 22 percent on its four-way PowerEdge 6600. Dell also is reducing prices by $550 on some Precision workstation configurations and $50 on its commercial OptiPlex PCs. The cuts come less than a month after Dell rolled out the OptiPlex 160L, aimed at giving small and mid-sized businesses—which in the past had to choose between the high costs of the OptiPlex or the consumer-oriented Dimension PCs—the enterprise features of the OptiPlex line.
The company also is reducing prices on Dimension desktop PCs by up to 6 percent, Inspiron notebooks by up to 3 percent and printers and projectors by 10 to 13 percent.
Dell spokesman Bruce Eric Anderson said some of the price reductions already have taken place, while others will occur by Thursday. "Theres not any given particular reason" for the timing of the price cuts, Anderson said. "Certainly now is the time people are looking at systems for back to school, so that plays into it. But this does span across both our commercial and consumer products." Dell last week announced that its revenue, income and product shipments jumped during the second quarter, with earnings climbing to $621 million on $9.8 billion in revenue. Product shipments increased 27 percent over the same period last year. The Dell price cuts also come a day after officials with Hewlett-Packard Co. said they were going to increase the prices of their PCs. During a conference call with analysts following the release of the companys earnings on Tuesday, Chairman and CEO Carly Fiorina said HP chased market share too much while ignoring the bottom line during the quarter by slashing prices in their PCs. An increase in component prices and Dells decision not to follow suit factored into HPs Personal Systems Group swinging from a $21 million profit in the previous quarter to a $56 million loss in the third quarter. In a prepared statement, HP officials said Dells price cuts illustrated a key difference between the two companies, that Dells only advantages is price while HP is an innovator.

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