IBM led the way last week in cutting prices on its desktops in anticipation of Intel's reduction of Pentium II cartridge prices yesterday.
Dell confirmed that it too would be making price cuts, but Compaq is holding its reductions until later, according to company officials.
IBM dropped the prices of eight models in its 300GL series by around #100, and reduced nine models in the 300PL range by #200 each.
Ray Badminton, desktop marketing manager at Dell UK, said: "I'm adjusting our prices now. We review our prices monthly and we can pass on price cuts to our customers quickly." But he refused to say how far Dell will drop the prices of its top-level boxes.
He claimed Compaq's business models preclude it from acting so quickly.
"They have too much inventory and stock in the channel," he said. "We're driving the Pentium II very fast."
The large price cuts on the Pentium IIs are set to cause a flurry of activity in the PC assembler market. Unlike companies such as Compaq, assemblers are able to adjust their activities fast, so are likely to reflect the swingeing price changes more rapidly than the majors.
A Compaq representative said: "We have no plans to make price cuts on our desktops". Toshiba refused to say whether it will reduce prices on its systems, although sources said it was likely.
IBM also introduced cuts on its Thinkpad notebook range. For the first time, the company will offer a Thinkpad at below #1,000. The price of the 310/100 model was cut by 24% to #977.
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