Laptops go low cost

Toshiba, which has seen its market share lead in portable computers come under attack from Compaq (CPQ), is fighting back with new notebook computers designed mainly for the consumer retail market that are priced as low as $1,699.

Toshiba is also trying to recover from a major misstep last year, when the company retreated from consumer desktops.

But notebooks are the company's bread and butter, and here Toshiba will make its stand against a backdrop of shrinking market share. Toshiba's U.S. notebook share fell from a peak of 35 percent to a low of 18.6 percent in the second quarter of 1997, before edging up again to 21.2 percent in the third quarter, according to market researcher International Data Corp. (IDC).

"The whole underlying theme to today's announcement is a renewed focus on retail," said Chris Pollitt, a general manager with Toshiba. In the past, Pollitt said, the Satellite series has been offered in both corporate and consumer versions.

Going forward, Toshiba plans on offering Satellite notebooks mainly through the retail channel while corporate customers will be targeted with the Satellite Pro series notebooks, although they may offer corporate customers the systems as well. "We are trying to make our product line much simpler. There will be a strategic alignment of our [other] brands as we go forward," according to Pollitt.

"A lot of vendors retreated from retail last year. The retail market took a backseat to the corporate market. Without a major operating system upgrade to fuel [corporate] demand, vendors are now eyeing retail for an incremental opportunity," said Randy Giusto, an analyst with International Data Corporation.

The new Satellite 305 CDS will ship with a 166-MHz MMX Pentium processor and a 12.1-inch dual-scan LCD screen for an estimated street price of $1,699. Toshiba says the display offers higher contrast and better color quality than typical dual-scan display technology.

Toshiba is also offering the 315CDT, which comes with a 200-MHz MMX Pentium processor and 12.1-inch active-matrix display, while the 315CDS comes with the "color-bright" dual-scan display for an estimated street price of $2,199.

All models come with a 2GB hard disk drive, a 16X CD-ROM drive, and a 56-kbps modem.

The systems include software aimed at children in addition to the typical assortment of office productivity software, such as word processing and financial spreadsheet programs.