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Retailers: One Company, Two Brands

While PC shoppers may not immediately see fewer Hewlett-Packards and Compaqs in stores following the merger of the two computer giants, choice is definitely a casualty of vendor struggles for a shrinking desktop market.

"A lot of the retailers right now will typically only carry one or two brands," says Steve Baker, director of research for NPD Techworld. "People are not buying PCs at the same rate they were in the past [and] manufacturers are reacting."

And so are some retailers. For example, Best Buy has announced that it will market its own brand of PCs, at least partly because of worry about lack of consumer choices. Published reports contend that other major retailers are also considering their own lines.

HP executives maintain that consumer choice will not be sacrificed as a result of the merger. Sam Szteinbaum, general manager of consumer products in HP's personal systems group for North America, says that the new HP will turn orders around faster, helping retailers offer a range of price points efficiently. As for maintaining multiple brands, HP execs cite the business model of Procter & Gamble, which owns nearly every soap bar on the shelf.