January 14, 2000 9:20 AM PST

Compaq to test new waters with iPaq

Compaq Computer is on the verge of shipping its long-awaited iPaq, a simplified PC that it hopes will return the company to glory in the corporate market.

The iPaq is a watershed product for the Houston-based PC maker and one that, in some ways, Compaq is betting its future on. Compaq has set a number of goals for the iPaq, including simplified design, direct delivery to customer and Internet-centric features. It plans to begin shipping the iPaq Jan. 24.

The iPaq comes in two versions: USB port only and USB with "legacy" connectors. While some of the legacy-lite models will come with Windows 9x operating systems, legacy-free models will be available only with Windows 2000. Interestingly, Windows 2000 won't begin shipping from Microsoft until sometime in February, although many Microsoft customers have already been sent final versions of the OS.

Compaq relied on standard, off-the-shelf components in designing the iPaq, a bold departure from its past tendency of introducing some proprietary components. This change helped shorten development time and cut costs.

"The tallest barrier we have getting things to our customers is not the price. We typically have an 18-month development cycle for products, but iPaq came together in about 100 days," said Michael Takemura, product marketing manager of Compaq's Internet products and services group.

The entry-level iPaq--with 500-MHz Celeron processor, 64-MB of RAM and 4.3-GB hard drive--starts at $499.

The company also hopes to transform the way it and its customers think about buying and using PCs, Takemura said.

Compaq iPaq The iPaq represents a unified design approach that will become more deliberate and pronounced over time, particularly in products used both in the office and at home, Takemura said. "We see a collision course between work and home happening today, with more corporations supporting telecommuters and home workers."

This unified design approach first appeared in Compaq Armada notebooks last summer. With the new Armada line, Compaq introduced floppy, CD-ROM and DVD-ROM drives and other components able to be swapped between different models regardless of design. Customers will be able to use the same Armada drives and removable storage devices on the iPaq

Customers will have to adjust to new pricing from Compaq. Eight basic iPaq models will be available, but for a fairly inflexible price compared to the volume discounts customers might be used to. The move reflects Compaq's determination to build and deliver iPaq direct at an aggressive price and to simplify the procurement process.

"It's like going in and buying a Saturn," Takemura said. "It's a single price. You don't have to haggle over it."

Compaq will look to build simpler PCs and other devices that are easier for IT managers to manage and maintain and easier for workers to use and connect to the Internet.

The first step, Takemura said, is a set of management tools from Lindon, Utah-based Altiris that Compaq plans to release at the same time as the iPaq. The management tools will first appear on the iPaq.

 

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