IBM sub-$1,000 PC courts schools

IBM (IBM) unveiled a limited-time sales promotion offering schools a sub-$1,000 computer with monitor, evidence that major PC manufacturers will be targeting the education market.

Last year, PC makers gained on education market leader Apple Computer as schools started buying Windows-based computers that cost less than $1,000, according to industry analysts.

Now, IBM is hoping to steal more sales by offering educators systems priced starting at $972 that include a 166-MHz Pentium MMX processor, 32MB of memory, and a 14-inch monitor. IBM offers the same system to businesses for $938 without the monitor. A system with a 200-MHz Pentium MMX, 32MB of memory, monitor, and built-in networking capabilities is being offered for $1,090.

The catch: Schools have to buy at least two systems, and the offer only runs until June 30.

Even as a limited-time offer, IBM's promotion shows how vigorously PC makers are pursuing a market that is expected to approach $5 billion in revenues this year, according to market research firm Dataquest.

The segment is particularly attractive because of the intense upgrade cycle schools are going through. A recent report from International Data Corporation cites America's healthy economy and ample funding as reasons for a predicted five-year spending spurt on new systems that offer multimedia capabilities and Internet access.

IBM said the new systems will include technologies that ease system management tasks. For instance, system administrators can turn on and update systems with new software from another classroom or building. Also, the company said it will offer five different educational software bundles aimed at different age groups.