Quick--what do Apple Computer, Dell, Gateway, Hewlett-Packard,
IBM and Sony have in common? They all sell business PCs, right?
Well, yeah. But flagging sales and margins have them looking
elsewhere for profit--namely, your home entertainment center.
"Margins are tightening, prices are coming down, and PCs
are becoming more of a commodity than ever before," explains
Find/SVP researcher Larry Fisher, "so PC companies are
diversifying into consumer electronics." It turns out Apple
sells more iPods than iMacs, Gateway and Sony have their eyes glued
to flat-panel TVs, and without its digital imaging division,
HP's financials might have no black ink at all. IBM, the only
major player without an initiative in electronic gadgets, finally
got tired of the color red and sold its PC-manufacturing operation
to China's Lenovo Group. Dell insists it makes money selling
PCs but, by the way, it sure would like to come over and set up
your big-screen TV and home network--maybe even sell you a personal
photo printer over a cup of coffee and some Entenmann's.
With computer upgrade cycles lengthening, manufacturers are
hoping that home is where the profit is--something that remains to
be seen, say analysts. But in the meantime, will vendors also have
the resources to support your business PCs?
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Not to worry, says Harry Harczak, executive vice president for
CDW Inc., a leading distributor of all the brands mentioned above.
Manufacturers have separate teams dedicated to creating, selling
and building business products. No one will even notice when IBM
ThinkPads and desktops start coming from China, predicts Harczak,
because the design, labeling and support will still come from
IBM.
In a way, PC-makers are victims of their own success. Hardware
capabilities have so outstripped software demands that PC-users of
every kind are holding onto their computers longer and longer, says
Fisher. Likewise, the quality of hardware components is such that
the usual year of free technical support should suffice: PCs that
run without problems for the first 90 days rarely break down after
that. These days, according to Dell, the principal cause of
customer-support calls is spyware and other external intrusions
coming down from the internet to clog or hijack customer PCs.
Prevention--in the form of frequent data backups and Windows
updates, as well as the deployment of updated anti-virus, firewall
and other security software--is the only cure for those problems,
says Harczak.
After that, he says, "It should be business as
usual."