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RealTime IT News

Dell Finds Keys to the Digital Home

Dell lives and thrives in the enterprise, but it has gotten its feet in the door of the so-called "Digital Home" and has no plans on leaving anytime soon.

The Round Rock, Texas-based computer maker will launch a series of initiatives throughout the rest of the year that it said would make its products more appealing to consumer buyers who may be familiar with its PCs and laptops but not with its other offerings.

In a conference call to reporters Monday, Dell executives Mike George and Michael Farello said the company would add plasma-based televisions to augment its current supply of LCD screens, including its latest 30" model, to combat similar offerings from Gateway.

"We originally avoided the plasma market because we didn't think the technology was ready for primetime," George said. "The biggest change in plasma was the initial concern that you had a burn-in factor on the screen. That has become quite a bit less of a problem. Now we are thinking in terms of expanding our line-up just in time for the holiday sales season."

Dell did not mention which partners it was working with to manufacture the plasma-style TVs, but George said it was almost certain that the company would add more support staff to assist customers installing the TVs.

The company said it would also spend the rest of the year beefing up its Media Center computers with available upgrades to Microsoft's Windows Media Player. Dell has now shipped a grand total of 1,130 since the company's multi-function server boxes were first introduced in 4Q03. George also said Dell would continue its aggressive assault on HP's printer business with a concentrated focus on all-in-one printers.

Dell is also looking to enhance its Dell DJ brand MP3-player with more capacity to chip away at Apple Computer's market-leading iPod and iTunes combination. George said Dell could not match Apple's marketing success or the brand loyalty, but he remained firm in his conviction that Dell would be able to undercut Apple with lower prices, compatibility with more file formats and momentum for its continued partnership with MusicMatch (soon to be updated to version 8.2).

The strategy is being augmented with a revamped customer support site -- support.dell.com, launching in late June -- and an education campaign to enlighten consumers on the necessity of securing their home networks.

Dell also said it would launch an additional 20 kiosks in California this year, bringing the total up to 85 sites in 11 states by July. The additional 10" by 10" stands in shopping malls and airports will also display various Dell hardware. Farello said the California locations included locales in Los Angeles, San Diego and San Francisco.

The company has definitely been expanding outside of the enterprise market. According to research firm IDC, Dell's worldwide share of home shipments has increased from 3.2 percent (7th) in 2000 to 12.1 percent (2nd) in 2003. Dell lead worldwide shipments in education and government and has increased its share of the worldwide public-sector (combination of education and government) PC shipments from 14 percent in 2000 to 20.1 percent in 2003.

"Dell's overall performance in the PC market remains solid. In Q1 2004 they regained the No. 1 spot in total worldwide PC shipments and reached a new record share," IDC analyst Loren Loverde told internetnews.com. "As for their non-PC business, they're doing well and their model has proven effective."



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