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HP Offers One-Box PC Bundle

Wal-Mart package includes Celeron PC, monitor, and ink jet printer for less than $900.

By Tom Mainelli, PCWorld   

Initially available only at Wal-Mart stores, the package is geared toward new buyers intimidated by the sheer number of choices they face when buying their first PC, says Sam Szteinbaum, business manager for HP's North American consumer computing organization.

The system isn't exactly a barnburner, but it's a respectable first PC. It features a 600-MHz Intel Celeron processor, 64MB of SDRAM, a 20GB hard drive, a 48X CD-ROM drive, a network card, and Windows 98 Second Edition. The graphics controller is integrated into the system's Intel 810e chip set, and the monitor is a 15-inch Pavilion V50. You also get a DeskJet 610CL ink jet printer, which is a two-cartridge unit introduced in June 1999 (see "HP Introduces Three Midrange Printers").

The patent-pending packaging makes it easy for first-time users to unpack, set up, and operate their PCs, Szteinbaum says. When you open the box, you see a welcome mat offering basic instructions for all three pieces, as well as tech support numbers. Later, the company may offer a single number for all three.

Too Niche?

HP is on a roll in retail, but the one-box approach will appeal only to a limited segment of buyers and retailers, says Stephen Baker, vice president of technology products research at research firm PC Data.

Szteinbaum admits the one-size-fits-all approach won't appeal to all buyers, especially more experienced PC users who like to pick and choose. He uses a home stereo analogy to describe the target customer. Some people like a simple, one-piece unit that sounds fine, while others prefer to spend more money on individual components pieced together to suit their tastes.

However, Baker points out that some retailers may cringe at the loss of flexibility. Most retailers want to be able to coax a customer to jump from a 15-inch monitor to a 17-inch one, or from a low-end printer to a snazzier one, he says.

Baker concedes, however, that in places like Wal-Mart with limited shelf space for PCs, HP's one-box approach may find success. But he says, "It's going to be a very niche thing."

If the initial Pavilion one-box package is a success at Wal-Mart, it could find its way into other retailers, Szteinbaum says. Down the road, HP may try piecing together additional packages of its products. Its broad product diversity means future systems could feature combinations with products such as scanners and digital cameras, he says.

This is just HP's latest move to secure its hard-won spot at the top of the retail PC market. Trailing Compaq for most of 1999, HP capitalized on IBM's decision to leave the retail market late last year, Baker says. Since then, HP has bested Compaq in four of the last five months, according to PC Data. In June, HP held 42.8 percent of the retail market, compared to 28.9 percent for Compaq and 16.1 percent for Emachines.