Dell closes kiosks to chase HP in retail sales
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Dell Inc. this week announced that it is in the process of closing its retail kiosks in shopping malls and airports.
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Don't look on the Dell Web site for home AMD-based PCs. The company is selling them only in brick and mortar stores or via phone orders now.
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(InfoWorld) - Heading toward the end of a better-than-expected year for IT, the good news this week was that there were no big surprises when Hewlett-Packard, Cisco Systems, and Advanced Micro Devices laid out strategies at investor and analyst conferences. While IT product prices, especially in hardware sectors like chips and some types of networking equipment, have been under pressure, tech vendor sales have been strong generally. The Nasdaq Composite Index, home to a broad range of publicly traded IT companies, crossed 2400 in November and has remained at that level, after opening the year at 2244. Tuesday's U.S. Federal Reserve decision to leave rates unchanged, and a much better-than-expected report on retail sales Wednesday stoked markets overall. On Thursday the Dow Jones Industrial Average hit a new intraday high of 12427.17, and the Nasdaq surged by 21.44 points to close at 2453.85. AMD gave assurancesÂ Thursday at an analyst meeting in New York that its $5.4 billion merger with graphics chip maker ATI will result in greater-than-expected cost savings in 2007, and $80 million to $160 million in incremental revenue. This caused AMD shares to jump by $2.54 to close at $22.71. The company also stressed that it expects a revenue boost from Microsoft's Vista OS release. The company in OctoberÂ announced fourth quarter resultsÂ that beat analyst estimates, but there were concerns about profit margins. The challenge for AMD is to keep a lid on costs and continue to successfully challenge Intel, especially with quad-core products in 2007. At HP's meeting in New York Tuesday, Chief Financial Officer Robert Wayman said thatÂ the company is forecastingÂ fiscal 2008 revenue between $101 billion and $103 billion. The high side of that is slightly higher than the consensus analyst forecast of $102 billion, according to Thomson First Call. It was reassuring but not exciting, at the tail end of a great year from HP (despite theÂ board spying scandalÂ that cost Chairman Patricia Dunn her job in September). The day of the analyst meeting, HP shares (HPQ) closed at $39.83, down by $0.18. But HP's announcement with MicrosoftÂ on WednesdayÂ helped spark investor interest. The deal calls for the companies to work on a range of business software products to the enterprise market, including business intelligence software. HP closed Thursday at $39.91, up $0.19 for the day. At Cisco's C-Scape conference for analysts this week in San Jose, California the company stressed themes that it had hit earlier this year. The company says it will sustain double-digit growth through the rest of the decade by incorporating data, voice, video and mobile capabilities -- its "quadruple play" -- across product lines. This week, the companyÂ focused on the consumer sideÂ of the equation, spotlighting itsÂ merger with set-top box maker Scientific-Atlanta, and also its Linksys consumer gear. Cisco plans to maintain its stronghold in the enterprise while continuing to grow in the consumer market. By the second day of the conference, Cisco shares (CSCO) were up $0.14 from its close Monday. In the current upbeat climate, reassurances from IT heavyweights about the next few quarters could be enough to boost IT investor confidence into the new year.
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(InfoWorld) - Dell Inc. is working on plans to sell PCs through retail stores in Asia and Australia, as part of a wider shift within the company away from using only direct sales. Dell will add retail channels for PC sales in India, China, Australia and Japan, said T.R. Reid, a company spokesman. Dell will continue selling PCs directly to customers in these countries, which are the company's most important markets in the Asia-Pacific region. Reid did not say when retail PC sales would start in Asia, but indicated the company is talking to retail partners in the region. "There's really strong interest on the part of potential partners," he said. The addition of retail sales representsÂ a major strategy shift for Dell. The company pioneered the direct sales model during the 1990s, eschewing traditional PC sales channels for the Internet and telephone hotlines to become the world's biggest PC vendor. Until recently, Dell executives repeatedly dismissed the idea that retail sales would help reach customers in countries like China, saying direct sales would suffice. Dell's long-standing aversion to retail sales ended this year with the return of Michael Dell as company CEO in January. In the face of a U.S. Securities and Exchange investigation into the company's finances and sliding sales that toppled the company from its number-one spot, Dell has looked to reverse the company's fortunes. Part of his strategy includes embracing the retail channel, which has proved instrumental in the recent strong performance of rivals such as Acer Inc. and Hewlett-Packard Co. On June 10,Â the first Dell PCs went on sale with Wal-Mart StoresÂ in the U.S. and Puerto Rico. The company is now selling two desktop PC models through Wal-Mart, both of which are priced under US$700, based on plans announced last month. Â ADVERTISEMENTIBM Information On Demand 2006Industrial Industry Leaders, please join us at IBM's premier information management global event, IBM Information On Demand 2006, October 15-20, Anaheim, CA. More IBM business and technical solutions content in one place than ever before! Select from  over 800 sessions. Register today!
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(InfoWorld) - With U.S. markets closing for Thanksgiving, Google Inc.'s skyrocketing share price andÂ Dell Inc.'s earnings report are ending the fall trading season on a high note. Both developments, which pushed the Nasdaq Composite Index to rise 11.14 points and close at 2465.98 before the Thanksgiving break, highlight positive underlying trends but are shadowed by questions about long-term profits. Google (ticker symbol: GOOG), breaking the US$500 share-price mark Tuesday and staying above the magic number until Thanksgiving, has a market value greater than any media company and all IT companies except for Microsoft Corp. and Cisco Systems Inc. Google's lead in online search helps it grab a lion's share of online advertising revenue. Earlier this month, the Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers LLP (PwC) reported that companies spent about $4.2 billion on online ads in the third quarter, as the market grew for the eighth consecutive quarter. But what happens when that growth inevitably slows? Google, expected to generate $2.8 billion in profit this year, is spending enough on R&D to defend its search turf and challenge Microsoft and other software developers in a new generation of Internet-based applications. It is hiring developers at a dizzying rate, and there's no doubt its young talent is generating a wealth of ideas. Most analysts polled by Thomson First Call expect shares to go higher still. Meanwhile, analysts applauded Dell's earnings report, issued Tuesday: Research firm Bear Stearns immediately boosted its rating from "peer perform" to "outperform" while Needham & Co. upped its rating from "hold" to "buy." Shares of Dell (DELL) jumped by $2.31, to close Wednesday at $27.13 Dell said third-quarter net income was $677 million and earnings per share were $0.30. This compares with a profit of $606 million last year, and earlier expectations of $0.24 per share, according to a survey by Thomson Financial. At first blush, the earnings look great. Dell's gross profit margin increased to 17 percent from 15.5 percent in its disastrous second quarter. Following Hewlett-Packard Co.'s tremendous report last week, when it said it quadrupled quarterly profit, this suggests that manufacturers may not have to rely on deep discounts going forward. Dell pointed to strong sales of servers based on Advanced Micro Devices Inc. chips, suggesting that the hardware market is invigorated by competition with Intel Corp. But Dell is under investigation by the U.S. Securities Exchange Commission for possible accounting misstatements. It still has not submitted a confirmed, official earnings report. The quarter's figures, as well as prior-quarter numbers, may be restated. Also, while Dell may be doing well in the server market, its notebook sales are not rising as fast as the market in general, and HP notebook sales growth is outpacing Dell's. Adding insult to injury, HP has overtaken Dell in PC sales. So while the hardware market is doing better than expected earlier this year, the spoils may not be evenly divided. Â
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Printer and PC maker Hewlett-Packard Co. (HPQ.N: Quote, Profile, Research) will stop offering desktop workstations based on Intel Corp.
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By REXCRUM  SAN FRANCISCO - Dell Inc., the world's No. 2 personal-computer company, said Thursday that it will begin selling PCs on the shelves of retail giant Wal-Mart Stores Inc., in a deal that breaks with its longtime direct model of making computers on order for customers.
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The resurgence of Hewlett-Packard continued during its first fiscal quarter of 2007, which ended January 31, though if Michael Dell has been practicing his last laugh act since having resumed his CEO post at Dell Computer, he may very well have reason to continue practicing today. While last year's scandals didn't sink HP, they did hit the company in its weak spot: US revenues.
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Dell is closing down 140 of its Dell Direct kiosks in malls throughout the U.S.
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The company says it now has other ways to connect with customers, including its deal to sell PCs through retailer Best Buy, and no longer needs the 140 kiosks it had established across the country.
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Less-than-direct activities Dell continues to cheat on its twenty-year relationship with the direct sales model. Having fallen behind HP in the worldwide PC market, the Texas manufacturer earlier this month began selling selected desktops through WalMart stores in the U.S. and Canada. It's flirted with indirect sales in Europe. And now, it's in talks with various retail outlets in Asia.â¦
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Dell Inc said on Friday it had  cut from its Web site most consumer computers with chips from  Advanced Micro Devices Inc and would sell AMD-based PCs mainly  in stores and by phone.
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Direct sales aren't working the same magic they once did for the PC maker. Can it now cash in at retail?
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Dell has scaled back the range of consumer PCs with processors from AMD that it sells on its Web site, focussing almost exclusively on systems with Intel processors.Dell&#39;s entire line of AMD-based laptops for consumers, as well as most of its AMD-based consumer desktops, will now be sold only through Dell&#39;s 10,000 retail outlets worldwide, said Dell spokeswoman Anne Camden.Except for one desktop, the Inspiron 531, which includes the AMD Athlon 64 X2 Dual-Core 4000+ processor, Dell will focus its online consumer sales on Intel-based PCs. For businesses, Dell will continue to sell a range of AMD-based systems online.The decision, made this week, could be a setback for AMD. The Intel rival received a big boost in 2006 when Dell began offering its chips in desktops, laptops, and servers.AMD-based systems tend to be priced lower than Intel-based systems, so it makes sense for Dell to ship AMD products through retail channels, said Dean McCarron, founder and principal at Mercury Research.&quot;[Dell&#39;s decision] is not that surprising given that AMD&#39;s primary strength is the consumer retail channel,&quot; he said. Price points on PCs tend to be lower in the retail market, and retail buyers are more sensitive to cost than online buyers, McCarron said.AMD said the move was part of a strategy to offer a wider range of AMD-based PCs through retail channels. &quot;We are always evaluating product offerings and how customers can access them,&quot; Camden said.Not many consumers buy systems based on the processor type, she said, and few distinguish between AMD and Intel processors. Users select PCs based mostly on price and what they will use them for, such as surfing the Web or playing music and videos, she said.Dell has expanded its in-store offerings over the past six months by signing up more retailers, including Best Buy and Wal-Mart in the U.S., Tesco in the U.K., and Bic Camera in Japan.The retail strategy helped the company expand its lead over Hewlett-Packard as the largest U.S. PC vendor in the fourth quarter of 2007, according to IDC. However, HP remained the world&#39;s largest PC dealer, topping Dell, Acer and Lenovo, IDC said.Hewlett-Packard already offers more AMD-based PCs in retail than online, so Dell&#39;s decision isn&#39;t a first, McCarron said. Until it won over top-tier PC vendors several years ago, AMD relied on the retail market and white-box vendors for its chip sales.The effect of Dell&#39;s strategy shift on AMD remains to be seen, McCarron said. It is a large and important PC vendor, but it is also a relatively new partner for AMD.AMD has suffered some setbacks recently, reporting five straight quarterly losses and delaying shipments of some new desktop and server processors. Its market share was 23 percent in the fourth quarter of 2007, down a fraction from the year before, while Intel&#39;s market share climbed slightly to 77 percent, according to IDC.
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Dell's retail strategy is paying off in the U.S., but HP is still the biggest PC vendor worldwide.
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SAN FRANCISCO -- Dell Inc., the world's second-largest personal-computer maker, posted fourth-quarter profit and sales that trailed analysts' reduced estimates after the company lost customers to rivals over the holidays.
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Direct Stores scorned for retail relationships Dell is shutting down its 140 US store kiosks, made obsolete by the company's decision to jump into bed with retailers.â¦