AOL to sell discounted Intel PCs

AOL Europe last week stepped up its war with Dixons when it announced it will offer affordable Pentium III-based PCs in the UK with Intel.

AOL Europe last week stepped up its war with Dixons when it announced it will offer affordable Pentium III-based PCs in the UK with Intel.The ISP said new members to AOL's sister service, CompuServe, can buy a Fujitsu PC loaded with CompuServe 2000 internet access software for £599 or £999 and get a cash rebate of £150 and £250.AOL and Intel said they will also offer affordable PCs on a country-by-country basis through other PC manufacturers, but did not name vendors.The deal first came to light when AOL confirmed it was in talks with hardware vendors to supply cheap PCs. The offer follows a number of 'free' PC deals initiated by retailers and ISPs to win the war to gain members.Andreas Schmidt, chief executive of AOL Europe, said research had shown consumers are "increasingly purchasing PCs for the purpose of getting online and want an easy, convenient experience from a brand they trust.""This is the next step to turn the internet into a mass consumer medium in Europe," he added.Schmidt also accused Dixons of being a "dominant retail force" which was "not good for competition".But Dixons said the Office of Fair Trading had recently found the British PC market was competitive and offered a better choice than in France or Germany. It dismissed the AOL PC deal as a "more expensive replica" of what it offered.

• Dixons has acquired Elkjop, a pan-Nordic retailer of consumer electronics and household electrical appliances, for £444m. Dixons said it intends to use Elkjop's local expertise to launch its proven formats, including PC World, in the Nordic region.