Compaqs New Era

Company reworking corporate PCs; customers are wary.

Compaq Computer Corp. is reworking its corporate PC line and showing a new willingness to share its prototypes and development plans with users. But while customers said theyre pleased the computer maker is touting its innovation, their primary interest remains stability, not bells and whistles.

The Houston manufacturer this week will launch a line of products that consolidates the current Armada notebook line, the Thin Client and Professional Workstations, the iPaq desktop, and the DeskPro desktop PC lines into a single brand called Evo. The previous product lines will be phased out over the next 12 months.

Two notebooks, the N400c (replacing the Armada m300) and the N150 (replacing the m700), are available now. Both incorporate Intel Corp.s Pentium III or Celeron processor. Two new versions of the notebooks will be released this summer in conjunction with the Intel Almador chip set as well. Officials said that while Intel remains on the corporate road map for now, using chips from Advanced Micro Devices Inc. or Transmeta Corp. in the future is not out of the question.

A pair of new workstations, the W6000 and the W8000, will be available later this spring. A new thin client, the Evo T-20, will be available next month.

"This is about the rekindling of innovation in the commercial PC space," said Chris Landry, design center manager for the Access Business Group at Compaq. "It made sense to consolidate the product lines and evolve into one brand."

Customers, however, seemed underwhelmed by the flashy new goods. "At our last executive briefing, Compaq spent a lot of time asking us about color combos," said David Gruver, technical director of desktop services at SBC Communications Inc., in San Antonio, and a Compaq user considering the N400c. "I personally felt it was a waste of time. My issues are price and performance, image stability, form factor. Not aesthetics."

Compaq is also changing its tune in terms of what it decides to share with customers. The company traditionally has not talked about new products until they were ready to ship. Now, Compaq is on a campaign of what it calls "visioneering," talking openly about concepts that may never actually make it to market.

Among the key new features on the Evo notebooks is an interchangeable, snap-on wireless communication tool with a Universal Serial Bus interface that sits atop the notebooks display panel. The MultiPort currently accepts a module for 802.11b wireless LAN connectivity. A Bluetooth module is due in August, and a General Packet Radio Service module is due at the end of the year, officials said.

"I see this as purely a hedge," Gruver said. "IBM is much further along with real plans here. Compaq [seems] to be tossing this onto their boxes to hedge against the unknown of the wireless WAN, Bluetooth and so on. Compaq is selling the idea that you could buy now, upgrade later. It just doesnt work like that in the real world."

Even Compaq executives acknowledge theyre not clear on the necessity of such MultiPort options as the planned Bluetooth module. "Well have the product, but the question is, what are people going to use it for?" said Ken Willett, vice president of product management for Compaqs Commercial PC Group.

Other visions that may never leave Houston include a pair of notebooks with removable keyboards and track pads that are expected to use wireless connectivity.

Analysts and users say that in addition to tuning its product line, Compaq seems to be trying to use engineering innovation to distinguish itself from competitors, especially sales leader Dell Computer Corp., of Round Rock, Texas.

"Compaq has not had a reputation for being innovative, even though they are at times," said an IT vice president for a New York advertising company, who asked not to be named. "Their laptops and desktops probably make most IT people yawn. They probably do need to do something to their image."

"We went through a period with IBM, Compaq and Dell where they were very tight-lipped about the future," SBCs Gruver said. "We found it was not due to secrecy. They felt we would lose confidence in their ability to plan and execute. We hammered on them that we were adults and would take the information at face value. We always want to hear of their ideas."

But while some users like the prerelease product peek, they are adamant about their desire for real, useful products when shipment time rolls around.

"I think many of us are tired of buying things that dont end up being valuable to the business," said Gary Bronson, enterprise operations manager at Washington Group International Inc., in Boise, Idaho, and an eWeek Corporate Partner.