HP slashes workstation prices to regain market

HP slashes workstation prices to regain market
Tom Foremski
Hewlett-Packard (H-P) has slashed workstation prices by up to 37 per cent, directly challenging market leader Sun Microsystems as it attempts to regain lost market share.
The price cuts cover H-P’s PA-RISC microprocessor based Unix workstations. The company said that thanks to lower memory chip and disk drive costs, it has been able to significantly cut the price of its Unix workstations.
“We have fundamentally changed our business model by implementing a PC-like cost structure,” said Patty Azzarello, marketing manager for H-P’s Workstation Systems Division. “We’ve improved operational efficiencies by outsourcing manufacturing assembly, reducing inventory and field-sales costs and improving supply-chain management.”
According to US market research firm International Data Corporation (IDC), Sun is the leader in the Unix workstation market selling 285,815 units in 1997 compared with H-P’s 108,165 units. But if NT workstations are counted, H-P sold a total of 330,559 workstations last year. IDC says that Sun is also the Unix workstation market leader in terms of revenues.

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