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Last Updated: Thursday, 21 August, 2003, 08:35 GMT 09:35 UK
Dell makes grab for market share
Dell factory
Dell's slimmed-down manufacturing helps it stay cheap
Dell, the computer giant known for its aggressive pricing, has again slashed its prices in an attempt to reinforce its global market lead.

Dell's prices will now fall by up to 22%, taking its best-selling desktop computers down as low as $550.

Dell has won market share by competing on price, something it can do thanks to selling directly to the public, and tailoring manufacturing closely to demand.

But the company's move comes only days after Hewlett-Packard, its closest rival, announced a loss caused by over-eager discounting.

'Serendipitous'

The PC market is looking increasingly like a two-horse race

The timing of Dell's move is no accident: analysts say it is intended to position the company ideally for the back-to-school season, a time of peak demand for computers.

According to the firm, the timing was "serendipitous".

"When we see an opportunity to lower prices, we do it," Dell spokeswoman Wendy Giever said.

The markets were unimpressed, sending Dell shares down by 2% in late Wall Street trading, amid fears of a sector-wide slump.

The personal computer market, long a source of unstinting growth, has turned sour in the past couple of years, as demand levelled off and prices fell sharply.


WATCH AND LISTEN
The BBC's John Terrett
"He who has greatest market share will win the day when the full recovery comes"



SEE ALSO:
Why PCs are still a hard sell
21 Aug 03  |  Business
Hewlett Packard still struggling
19 Aug 03  |  Business
Dell Computer sees profits jump
13 Feb 03  |  Business
Hewlett Packard disappoints
27 Aug 02  |  Business
Profits rise at IBM
14 Apr 03  |  Business


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