Wednesday, August 27, 2008

Dell Unveils New Low-Cost Computer Models Outside the U.S.

Dell Inc., one of the biggest desktop PC and laptop manufacturers based in Round Rock, Texas, has just unveiled its four low-cost computer models for India, China and other emerging economies in a new bid to tap the potential of high-growth markets outside the U.S.

According to Steve Felice, the U.S. computer maker’s president for the Asia-Pacific, the two desktop PCs and two laptops are the first Dell models that designed especially for emerging markets. They are highly recommended for small-business users and are to be sold in 20 countries across Asia, Africa and Latin America. Moreover, Felice said, "Our success is going to be largely dependent on our ability to expand globally."

Despite a slowing U.S. economy, strong sales in Asia have helped Dell turn in better-than-expected results in the last quarter. It is due to report its latest quarterly results after the U.S. markets close Thursday, and analysts are watching whether it can manage its growth pace.

In China, Dell computers are sold in 2,700 outlets of the Gome and Suning electronics store chains, which are account for about half of Dell's Chinese sales. In addition, Dell has about 13,000 retail outlets worldwide. Dell is trying to expand its presence in China outside Shanghai, Beijing and other big eastern cities and sees 50 percent of potential sales in small, inland cities.

Dell and rivals Hewlett-Packard Co., China's Lenovo Group and Taiwan-based Acer Inc. are expanding aggressively in emerging economies as sales growth in the U.S. and other developed markets slows. According to Felice, Dell's first-quarter sales in Brazil, Russia, India, and China, which is known collectively as BRIC, grew by 58 percent, about 10 times the U.S. rate. He said Dell expects 20-30 percent annual growth in those markets in coming years.

On the other hand, Beijing-based Lenovo, which acquired IBM Corp.'s PC unit in 2005, is targeting China's vast but poor rural market with a basic PC released last year and priced as low as 1,499 Yuan ($220).

According to Felice, industry predicts say China's computer sales should grow from 50 million units last year to 500 million by 2015, or double that year's projected U.S. sales.

Prices for the new Vestro laptops will start at 3,299 Yuan ($475) and for the desktop PCs at 2,999 Yuan ($440). These new Dell models were created by a Shanghai design center set up to focus on emerging markets.

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