Hewlett unveils low-cost workstations

PALO ALTO, Calif. -- Hewlett-Packard Co., in a major challenge to market leader Sun Microsystems Inc., unveiled a line of workstations Tuesday that are the fastest computers on the market selling for less than $10,000.

Hewlett-Packard, which has about 20 percent of the $8 billion workstation market, said the HP Apollo 9000 Model 705 Color has prices starting at $8,990 and surpasses competitors such as Sun and IBM on price and performance in the entry-level color workstation market.


Analysts say the low end of the workstation market -- between $5,000 and $10,000 -- is crucial for workstation producers because it is often the start of doing business with potentially big accounts at large corporations.

Sun, which has about 30 percent of the workstation market, is expected to debut a low-end computer line code named 'Tsunami' in the late summer.

Hewlett-Packard, which has been working on boosting its reputation as a technological leader in the field, will be powered by its reduced instruction-set computing microprocessor called Precision Architecture.

Its announcement about the new machine used specific comparisons with competing workstations produced by Sun and IBM.

Hewlett-Packard said that with typical configurations -- using a 420- megabyte hard disk and 16 megabytes of memory -- the HP Apollo 9000 will deliver 40 percent greater system performance, nearly 70 percent greater graphics performance and nearly 40 percent greater price/performance than Sun's more expensive Sparcstation IPX.


It also said that the new machine delivers more than 30 percent greater system performance, 400 percent greater graphics performance and entry color prices $500 less than the IBM RS/6000 Model 220.

Hewlett-Packard also said it has cut the entry price of the current Model 710 color workstations by $1,500 to $12,490.

Hewlett-Packard, the third-largest computer supplier in the United States, posted a 49 percent increase in earnings to $306 million, or $1. 21 a share, for the first quarter ended Jan. 31, compared with $205 million, or 83 cents a share, in the year-ago period.

The earnings were well above analysts' expectations. First-quarter revenues were $3.86 billion, up 13.2 percent from $3.41 billion in the year-ago quarter.

Analysts said the results showed the positive effects of Hewlett's efforts to restructure itself since 1990 under John Young, its chief executive officer. It has eliminated management layers, reorganized sales and cut 3,300 people from its work force last fall through voluntary severance.

Orders for the quarter were $4.2 billion, compared with $3.7 billion in the first quarter of 1991, with volume for it HP LaserJet and HP DeskJet printers up sharply.

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