Newspaper article The Christian Science Monitor

HOT COMPETITION Computer, Accessory Prices Take a Cut for Buying Season

Newspaper article The Christian Science Monitor

HOT COMPETITION Computer, Accessory Prices Take a Cut for Buying Season

Article excerpt

PERSONAL-computer manufacturers are at it again. They're lowering prices in expectation of a heavy holiday buying season. And it's not just the cost of the computer itself that's coming down. In a rare lock step, computer peripherals such as printers, CD-ROM players, and monitors are also moving down the same price curve. The result? For the rest of the year, consumers can expect price declines of anywhere from 4 percent to 13 percent for computer systems, according to International Data Corporation, based in Framingham, Mass. And several computer peripherals have become suddenly less expensive. "You're getting more bang for your buck," says John Murphy, editor of the PC Street Price Index, based in Gibbsboro, N.J. Take printers. At the beginning of the year, the price of a full-color ink-jet printer stood at $600. In recent weeks, intensifying competition and the entry of new companies in the ink-jet market have forced prices down to $500, and they're dropping fast, says Charles LeCompte, editor of The Hard Copy Observer, a Newton Highlands, Mass., publication that follows the printer industry. For the last couple of years, the cheapest laser printers cost $500. All of a sudden, they're $400. A similar pattern has happened in CD-ROM players. Market leaders Panasonic Company and Sony Electronics have boosted their manufacturing capacity, putting a squeeze on prices. A double-speed player, which averaged at wholesale about $105 in May, had fallen to a range of $82 to $85 by August. Price cuts encourage upgrading Sometimes, the price drops merely push consumers to upgrade to better technology. This appears to be happening in CD-ROM players as sales of triple-speed and quadruple-speed models begin to come on strong. "You can expect six-speed and eight-speed {models} next year," says Jim Porter, president of Disk/Trend Inc., a Mountain View, Calif., research firm. The same holds true for computer disk drives, he adds. In 1993, the biggest selling drive was 170 megabytes. This year, consumers are snapping up, for the same price, drives that average 240 megabytes or so. Next year, they'll be able to buy 340- or even 420-megabyte drives for the same price. The pace of the disk industry's technology improvements has actually picked up. From the mid-1950s to about 1992, the amount of information a single disk could hold increased some 30 percent every year, Mr. Porter says. Since 1992, the increase has been 60 percent a year, and that trend will likely continue for the rest of the decade, he adds. …
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