This article (which is only tangential to this post) reminds me of something that is occurring to me right now.
http://www.alleyinsider.com/2008/4/_dell_s_still_a_dog_barrons
So, recently I think I hit the major difference between the Dell strategy versus the HP strategy.
I am right now looking for a tablet PC, and two of the choices I have (among others) is the XT from Dell and the tz2000 from HP. And here is where it gets interesting. The Dell XT has gotten great reviews, is considered top of the line with the best specs. For this, you are going to pay about 2.5k. On the other hand, the tz2000 has only gotten decent reviews, and uses an AMD processor (which is not nearly as good) but costs only about 1k. The 1k would provide more hard drive space, and more RAM.
Dell is trying to move upscale. The XT along with their XPS series is their plan to get higher profit margins per computer sold. HP on the other hand, is trying to move downwards. Marketing to the masses. Quite frankly, it looks like a “grass is greener on the other side” play by both.
So which side wins? Dell made their money initially by being the computer for the masses. Additionally, even laptops nowadays are becoming more and more commoditized. This leads to market share going to HP. On the other hand, selling a ton of computers for no profit is actually worse for a company than to sell a few computers at some profit. The hard part is creating something which allows you to differentiate yourself. Unfortunately, the lines like XPS and XT don’t have much other than their hardware to differentiate themselves. In a case like this, the only thing you can try and do is differentiate via your Brand (think Sony VAIO line).
So here’s the weird part. Dell already has a brand for this (They bought Alienware a while ago.) So why do they feel the need to have a line named after Dell to hit the exact same market? Alienware was never more than a brand built around high end generic hardware, which is pretty much what XPS is as well. They are putting in a lot of effort to redo something they already had from an acquisition.
So, which one will I end up going with? In this case, almost assuredly the HP. While the XT may be worth the money needed to pay for it, I just don’t have an interest in spending 2.5k for a tablet PC which is really just a gadget buy for me. After all, the screen size is the same, they both use the wacom digitizer, and those are the two main pieces of interaction I would be having. I am wondering if this is the case for most people.
