PC makers in cutthroat Christmas

US PC manufacturers are engaged in a vicious round of Christmas price cuts and all-out battles for market share.

Hewlett Packard (HP), Gateway and eMachines have been targeting sales of entry level computers that cost less than $600 (£375).

According to Reuters one of the most aggressive is HP, which made headlines last week with its package of PC, flat-panel monitor and printer for under $700 (£438).

But HP's main rival, Dell, known for launching price wars, has not followed suit. It said it will concentrate on building more upmarket sales.

The emphasis on low prices has hit just as manufacturers face a third consecutive weak holiday season for PCs.

Rather than upgrade, many users have turned instead to digital cameras, home networking equipment and multi-function printers.