IDC: European PC vendors under pricing pressure

Vendor competition and continued development in the entry-level notebook market will keep European PC prices falling in the near...

Vendor competition and continued development in the entry-level notebook market will keep European PC prices falling in the near term, according to a study released by market researcher IDC.

IDC predicts that notebook price tags will continue to fall as a result of heated competition in the entry-level segment. Although component prices continue to remain high, PC vendors will likely absorb those costs to stay competitive, IDC said.

And even though desktop and server prices had begun to return to mid-2001 levels in the first quarter of this year, thanks to the market transition to Pentium 4 processors, they are also poised to decline as demand slows, IDC said.

Competitive pricing from Dell Computer is also having an effect on the market, especially in the UK and Germany, the researcher noted.

Dell released revised second-quarter guidance figures, predicting higher sales boosted by growth in the US government, education and consumer market.

Hewlett-Packard (HP) is also keeping the heat on European vendors, in a bid to maintain prices despite increased component part costs.

IDC expects that the merger between HP and Compaq Computer will affect all market players, as the new company consolidates its product lines and works to increase margins.

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