Another brutal twist in the PC price-cutting war is due in November when Korean company Trigem Computer will launch a mid- range machine that will breach the $500 barrier. It will use a 266MHz processor, 32MB RAM and include a 14 inch monitor and 56K modem. News of the new PC was given by Trigem’s founder and chairman Yong-The Lee at the ETRE computer conference in Estoril, Portugal and caught Trigem’s worldwide organization by surprise as the top secret project was not due to be revealed until the end of this month. The PC will be sold under Trigem’s name in the US where the company assembles between 50,000 to 70,000 PCs a year at its Fremont, California base and sells through major stores. In Europe, it makes PCs for other suppliers and the sub- $500 PCs will be badged under the name of two as yet undisclosed partners in Europe. Although Trigem will be working on tiny margins to get below $500, Lee believes that the price will fuel an explosive growth in PC sales, similar to the way that video recorders became universal devices once they breached the $500 barrier. The move will add enormously to the pressures on companies like Packard Bell NEC and who are losing large sums on their PC operations as a result of the slump in prices. IBM Corp, whose PC operation is far from being a commercial success, has turned to Taiwan’s Acer Inc to build their machines (CI No 3,489), an inevitable move as PCs increasingly become commodity items. Although Trigem sources suggest that the sub-$500 machine was planned before Korea was hit by the Asian economic crisis, the slide in the value of the Korean Won will make it easier to sell inexpensive PCs to the developed world.
