Re: 560 vs. 701

[Randy Whittle <whittle@usc.edu>]

At 09:28 PM 9/6/96 GMT, epbrown wrote:
>"Remember thjat the machine you paid $1500 for listed for several times
>"that amount. I doubt what you suggest is feasible at $2500, looking at
>"the pricing of other thinkpads.
>"
>	I don't know about that.  Doesn't the 365X come with a lot of those
>features?  My last issue of USAFlex catalog lists this model for $1999 with a
>Pentium 100, 810MB HDD, has the 16-bit sound and built-in port, it's just
>missing the modem and Lit-Ion technology. They're within throwing distance
>already.    Other manufacturers are already there, like Sharp with their 3040.

        I think when IBM priced the 701 (initially), they were under the
mistaken belief that it was *so* neato that they could sell it at a
significant premium (as they do the 760's now), a belief borne probably due
to that folding keyboard's proprietary patent.  Obviously, the market didn't
agree with them (until they lowered the prices and the things sold like
crazy).  Since then, we've seen smaller form factor notebooks of all types
selling in a range somewhere between the cheapos and the full-featured ones.

        I don't really think IBM lost their shirts on the 701--as a matter
of fact, I think they may very well have just over-estimated their ability
to charge a premium and "clean up" as it were on the machine.  But even when
they dropped those prices, they kept producing them--not usually a smart
move if they cost you more than the selling price to make.

        I suppose they could consider the 701 a "loss" if you just look at
what they *expected* to make vs. what they actually did, but I doubt they
actually lost money on it.

-------
Randy Whittle		rwhittle@usa.net
USC Graduate School of Business    http://www-scf.usc.edu/~whittle