If demand for network computers grows HP can enter the marketplace fairly easily, but CEO Lew Platt predicts it is better off concentrating on the NetPC for now.
Speaking in Sydney last week, Platt said it was technically easy to enter the NC market. “But we’ve chosen to instead stay with the NetPC and emphasise full PC compatibility, which you don’t get with the NC, to emphasise some local processing capabilities — which you also don’t get with the NC. And to drive down the cost of that product, the NetPC, so that it really puts a lot of competitive pressure on the NC.”
Platt says HP has just introduced a product in the US which sells for under $US1000. “An NC is about $US500, but by the time you add some things to the NC, which most people do, you get up to the same price range.”
Platt says HP can change the strategy if it proves to be wrong. Platt says the important thing is to emphasise the total cost of ownership. Support costs over a lifetime of the PC totally swamp what you pay for it.”
He says HP’s alliance with Microsoft, which began in April this year, was directed at the cost of ownership.
“The whole war over whether you want thin clients, ultra thin clients, or $500 products or $900 products will disappear if we can attack the many thousand-dollar costs, typically $4000 to $8000 cost of supporting that product over its lifetime.”