The past few weeks in the desktop and portable sectors have seen free PC vendors having a go at each other and Compaq taking a scalpel to its workforce after a massive second-quarter loss.
Rivals Time and Tiny are squabbling about whose free PC offer is the best. Excuse me for asking, but how can something that is supposedly free be more free than another free thing? We know that IT spin doctors are good at coming up with ways of making technology sexy, but it seems as though they have decided they can mess around with the meaning of the word free.
Take any free PC offer and you will soon find that the free aspect comes with strings attached, ranging from monthly ISP costs, guaranteed advertising on your screen every time you boot up, or fixed telephone costs through some telecoms provider that wants you to use your PC to hit the internet and boost its call charge revenue.
There's always going to be a cost and Time and Tiny are just getting back their free PC money in different ways. There are still a lot of people who can't afford the upfront costs of a PC, and now Brookside has characters surfing the net at home, it won't be long before the free PC boat truly comes in. That said, Time and Tiny should be worried less about discrediting each other and more about what the big fish are planning. All it needs is BT and IBM to get friendly and they'll have more problems than a Compaq balance sheet.
Compaq's latest results were not unexpected - a quarterly loss of $184m - and it has also unveiled plans to shed up to 8,000 staff as it attempts to cut $2bn in overheads. In a statement, Michael Capellas, replacement chief executive for ousted Eckhard Pfeiffer, was confident profit would be back in September and that the industry would "see Compaq work with the channel to improve channel efficiency". Surely he means work without the channel, since the constant streamlining of its partners looks set to continue. In fact, the European part of Compaq's policy for working with the channel should be kicking in now.
So, like the recently departed Pfeiffer, have your parachutes at the ready, although it's doubtful that yours will be spun of the same golden threads as his.
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