Big brands enter assembled market

It is a market where all the desktop action is. Today, the assembled market
constitutes the largest chunk of the market. According to DQ Top 20 estimates,
this segment accounts for 64% of the total desktop segment revenues. So even a
small percentage of this market would mean huge volumes for any player. No
wonder big brands have been trying to get a foothold in this market. Samsung’s
failure with its BUPC (which has been shelved) has not perturbed the biggies to
enter this space. In fact with the entry of players like HP might mark the
beginning of a new era, with branded vendors trying to eat the assembled pie
with cost advantage and better service offerings.

IDC computing products research head Aman Munglani does not feel this way.
"Venture into white boxes means only a money avenue. Only those vendors who
are looking at a new revenue stream will venture into it, I doubt if more
vendors will follow suit," he observed." For HP, this entry into the
assembled PC market is a first in its global operations. It is a part of its
strategy to be among the growing assembled PC market in the country. The company
will begin this new business model with a pilot project called IMPACT
(international modular premium assembled component technology). In this new
program, it will partner with local white box assemblers by supplying them with
a basic PC configuration and optional components. An assembler will have
flexibility to customize according to customer preferences. The new non-branded
base unit from HP will have a chassis, motherboard, floppy disk drive,
power-supply, key board and mouse.

Logistically, it is more convenient to offer this product as it rules out the
need for a push in the market and sells easily through channels. One more aspect
can be the recurring profits out of the after sales services. With the PC
penetration increasing–flexible, cheaper and better configuration might define
the PC buying behavior unlike today’s big brand better service image. Experts
also feel that due to its cheaper price buyers might prefer the non-branded
offering from the vendor.

SHWETA KHANNA in New Delhi