Dell chases Compaq's top brand spot

Computer giant Compaq, the most frequently chosen IT hardware brand for UK corporate IT projects in 2002, is facing a growing threat from rival Dell.

But the adage that you could never be fired for buying IBM no longer appears to ring true. The Big Blue brand only managed third place, according to a study of the top IT hardware brands in the UK from IT research and publishing company MIS UK.

The findings are based on UK IT directors' hardware buying preferences across 582 corporate IT projects during 2002.

Compaq's early moves into the sector appear to have paid off - one in five Compaq users cited this as their reason for choosing the vendor, followed closely by price performance, rated by 17.8 per cent of respondents.

Most Dell customers, meanwhile, selected their kit on the back of pricing factors (19.2 per cent) with 16.1 per cent stating it was the company standard.

"As a PC and PC server vendor, Compaq's products meet modern enterprise price performance needs, having successfully commoditised both the desktop and server spaces of the major Unix vendors in close partnership with Microsoft," said Quentin Long, managing director of MIS UK.

But the analyst believes a combination of Dell's aggressive pricing strategy and successful direct sales model will continue to gnaw at Compaq's share.

"HP has to take the high ground and find a much better model to compete with Dell," Long said. Attempts to move into the services market, however, have so far proved relatively unsuccessful compared with competitors in the market.

"To beat Dell on price, HP would have to change the way it works but I think they're too distracted at the moment to do that," Long said. "They can succeed but it will involve a massive shift in culture and they way they approach the market."

Although 21.4 per cent of respondents said IBM was a company standard it does not rate well on price performance, with only 13.7 per cent users citing this as their reason for selecting IBM.

Sun Microsystems, meanwhile, is losing out as it tries to reposition itself in the software market. "Sun bet on web services and tried to turn into a software company, but if that doesn't work they will be taken over and they're not succeeding at the moment," Long said.