AST is to pull out of the European desktop PC and server market. The company will halve its European workforce and concentrate on notebook PCs. AST's share of the worldwide market for PCs fell to 2.5% in Q4 of last year, according to Dataquest. AST employs 130 people in the UK but refused to tell PC Week how many of those jobs are expected to go. It is only be a matter of time before AST abandons the notebook market as well, predicted Mike Welch, consultant with market analyst firm Inteco. "It will become increasingly difficult for AST to compete against the likes of Compaq and Toshiba," he warned. Dataquest analyst Chris Jones, agreed. The company's decision to pull out of the consumer market may have been a mistake, he said, since it meant loss of economies of scale. "Although the company has a strong market share in Scandinavia and the UK this is not enough to compete in today's commercial market," said Jones. "It's going to be tough with notebooks, where Toshiba has a stronghold," he added.
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