Compaq has unveiled its latest weapon in the battle to win business at the bottom end of the market, a £499 PC available through the Dixons group.
According to the vendor, the Presario 5410 PC, which includes a 350MHz AMD K6-2 processor, 4.3Gbyte hard drive, 56Kbps modem, speakers, 15 inch monitor, Windows 98 and Word 2000, is aimed at the back to school and student market.
The deal also includes a month's free Internet service from AOL, pay as you go access through BT Click and one year on site warranty.
Lisa Clarke, Compaq product marketing manager, conceded that it would make less profit than usual, "in percentage and nominal terms" on the machines, but denied the company would actually lose money on the line.
"It's not a loss leader in the sense that Compaq doesn't make any model that we don't expect to make money on," Clarke said.
Compaq had avoided playing in the very low end in the past, but greater efficiencies in the manufacturing process meant it could now do so, Clarke said.
"We now feel we can do that profitably," she said.
The machine had been launched in response to a request from Dixons, which saw the opportunity for significant sales at the sub £500 price point, she added.
It is only available through Dixons, Currys and PC World.
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