Four New, Lower-Cost IBM Computers Unveiled
IBM on Wednesday announced four new, aggressively priced personal computers, another move by the world’s largest PC maker to compete with low-cost personal computer “clones.”
The PC announcement, part of a spree of product unveilings and enhancements by International Business Machines Corp., followed two rounds of PC price cuts by the leading computer maker in recent months.
“It’s IBM adjusting to the reality of the market,” said Don Young, an analyst with Shearson Lehman Bros. He said the street prices of the new models should match all but the cheapest IBM PC clones.
List prices for the new models start at $1,995 and go to $4,195.
The announcement came against a background of growing pressure on IBM to become more efficient and profitable. Its first-quarter operating profit fell by half compared to a year earlier.
The new models are based on Intel Corp.’s 386 SX microprocessor, one of the most widely used “brains” of personal computers. They are in the middle of IBM’s PS-2 line of personal computers in terms of price and performance.
In other developments, IBM:
* Became the first PC maker to announce that it will use Intel’s 486 microprocessor that runs at 50 megahertz. Intel itself has not even announced this fastest version of its top processor chip; the announcement is expected in two weeks.
IBM disclosed prices for kits to upgrade existing high-end IBM PCs to the new 486 microprocessor, but did not say when they would be available. It said customers had requested pricing information for budgeting purposes for the second half of the year.
* Unveiled a program that allows customers to trade in older PCs, including some made by Apple Computer Inc. and Compaq Computer Corp., for $200 to $1,200 rebates on new IBM models.
* Introduced a diskette drive designed for new diskettes that hold up to twice as much data as existing diskettes. It also unveiled an optical disk drive, a relatively new technology that stores 88 times more information on a 3 1/2-inch-wide cartridge than on a standard magnetic diskette.
