Dell printers, PDAs could drive down prices

Dell Computer Corp.’s eventual entry into the printer and personal digital assistant (PDA) markets will cause headaches for some vendors and delight users as the company drives down prices, say analysts.

Dell chairman and CEO Michael Dell confirmed the company will sell printers and PDAs, during a recent press conference announcing the company’s earnings. He would not specify when printers and PDAs will be sold, but said the company views both areas as “attractive markets.”

Representatives of Dell Canada were also unavailable to comment on whether such a move would extend into this country.

Hewlett-Packard Co. (HP) is the acknowledged leader in the enterprise printer business, where Dell will initially look to compete with large laser printers, said Steve Baker, director of research at NPD Techworld. “High-end printers are a high price-point, low-volume market, and Dell’s opportunities will be much better there in the short run,” he said. Dell’s traditional strength has always been in the business markets, and only recently have its products grown among consumers, he said.

HP will be forced to examine its business model, and see if it can find a way to more aggressively price its products, Baker said.

Dell’s ability to deftly manage its manufacturing and distribution activities will serve it well in the printer business, said Rob Enderle, research fellow at Giga Information Group Inc. Due to the strength of the enterprise printer players, however, Dell will probably look at first to partner with a more established company, like Lexmark International Inc. or Xerox Corp., he said.

While the printer market may seem like a more natural complement to Dell’s PC and server businesses, both analysts agreed that the enterprise handheld market has more potential in the long term.

“The adoption of PDAs and wireless connectivity is pretty low right now, so there’s a lot of opportunity in vertical markets,” Baker said. Consumer PDA leaders Palm Inc. haven’t spent as much time developing the enterprise handheld market, he said.

“Handhelds are more simple and Dell-like,” Enderle said. The margins on printers are extremely low, with many machines sold at near cost, and companies looking to make their money on ink cartridge sales, he said.

Dell, based in Round Rock, Tex., will attempt to get products out in the fourth quarter, Enderle said. Initially, the company will compete mainly on price, but will look to incorporate new features and options into the second generation of its products, he said.

“Dell has proven they can bring out quality products at lower prices. Businesses are looking for value above all else right now, and if (the products) are good enough, they’ll do OK,” Enderle said.

Would you recommend this article?

Share

Thanks for taking the time to let us know what you think of this article!
We'd love to hear your opinion about this or any other story you read in our publication.


Jim Love, Chief Content Officer, IT World Canada

Featured Download

Featured Articles

Cybersecurity in 2024: Priorities and challenges for Canadian organizations 

By Derek Manky As predictions for 2024 point to the continued expansion...

Survey shows generative AI is a top priority for Canadian corporate leaders.

Leaders are devoting significant budget to generative AI for 2024 Canadian corporate...

Related Tech News

Tech Jobs

Our experienced team of journalists and bloggers bring you engaging in-depth interviews, videos and content targeted to IT professionals and line-of-business executives.

Tech Companies Hiring Right Now