HP rolling out $649 Brio 200 PC
The Palo Alto, Calif., company's PC division on Monday will announce a new low-cost Brio PC, the BA 200, aimed at small businesses that purchase white box PCs -- non-branded PCs assembled by resellers or consumer PCs from manufacturers such as eMachines Inc. at retail.
HP (NYSE:HWP) research showed, "There's such a number of white box customers (among small businesses) that a branded PC would be a good idea," said Jennifer Korpak, a Brio product manager at HP.
The BA 200 will be available in two models, starting at $499 without and $649 with a 15-inch monitor. Additionally, HP will partner with an Internet service provider (ISP) to offer a rebate for the PC. It will be sold direct to customers and via resellers Tech Data Corp. and Synnex Information Technologies Inc.
The PC, which combines Intel Corp.'s (Nasdaq:INTC) Celeron processor and 810 chip set, is similar to HP's other Brio offerings in that it uses the same chassis and supports PC management technologies like Wired for Management.
Some compromises
HP, admittedly, did have to make some compromises to hit the low price point. Most of them, however, are minor, such as going with a 40X CD-ROM instead of a 48X and including three PCI slots instead of four. The most noticeable compromise is 32MB of RAM and lack of a modem on the $499 model. Otherwise the PC is outfitted with a 433MHz Celeron chip and 4.3GB hard drive. HP also provides a year of on site service, with the option of adding additional time to the contract.
HP eliminates most of the compromises with a more expensive model. Priced at $650, it provides 64MB of RAM, a larger 8.4GB hard drive and a 56Kbps modem.
With memory prices having risen and the Taiwan earthquake causing shortages of certain components, PC prices are in question. Most analysts say believe PC prices will hold steady, HP believes that it can hold to $499
"We're going to be holding steady on that price," Korpak said. "We believe we can keep those price points the same throughout the next year."
As component prices fall, however, HP will likely add features, upgrading the processor speed of both models and possibly adding a modem to the $499 version early next year. What is likely to happen, due to the Taiwan quake, is that HP will have to wait longer to refresh the Brio 200 models, most likely February, instead of early January, she said.
The rebate will offer new Brio 200 customers $99 for a one-year commitment or $400 for a three-year commitment, Korpak said. The name of the ISP is not yet available as the deal is still being finalized.
HP will also offer a 15-inch monitor for the Brio BA 200 PCs for $150, making the bundled price $649 or $799, depending on the model a customer chooses.
Stiff competition
While HP will announce the new Brio models Monday, small business models have been around for some time. IBM (NYSE:IBM), for example, offers the PC 300GL Small Business Edition. They key difference between the PC300GL and the Brio, however, is price. The IBM PC starts at about $900 without a monitor, according to IBM's Web site.
However, HP does face competition. Several other PC makers have announced low-cost PCs this week.
Compaq Computer Corp. (NYSE:CPQ) and Gateway Inc. (NYSE:GTW), each launched low-cost PCs. Compaq last Monday introduced a limited edition Deskpro EP Series model, priced at $819 with a 15-inch monitor. The machine, which offers a 433MHz Celeron chip, 32MB of RAM and 4.3GB hard drive, will be available until Compaq exhausts its supply of 433MHz Celeron chips, a company spokesman said. A similar model with a 466MHz Celeron chip is priced at $879.
Meanwhile, Gateway on Thursday announced the Astro, an all-in-one design PC, priced at $799. The Astro, which is similar in concept to Apple Computer Inc.'s (Nasdaq:AAPL) iMac, integrates a 15-inch monitor with a 400MHz Celeron chip, 64MB of RAM, 4.3GB hard drive and 40X CD-ROM Drive.