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- Apple Confidential 3/22
-
-
- IBM ANNOUNCES NEW PRODUCTS
-
-
- By: Dave Garr and Michael Mace, Competitive Analysis
-
- _____________________________
- Summary
-
- IBM announced a bundle of new products March 20. None of them were
- breakthroughs, but there were some interesting developments. The highlights
- included:
- • A new Model 80 “tower” machine that uses a 25 MHz 386 processor.
- • A new Model 65 sx tower using the 16 MHz 386sx processor.
- • The cheapest PostScript printer from a major company.
- • Two SCSI adapter boards, three SCSI hard drives, and a CD-ROM drive.
- SCSI boards are bundled with the new tower machines.
- • IBM cut prices on several existing products.
- • OS/2 Extended Edition 1.2 finally shipped.
-
- The laser printer is probably the most important product to Apple. The CPUs
- don’t break new ground, and while it’s interesting that IBM is adopting SCSI,
- the products are fairly expensive and aimed at the server market. Compaq and
- other competitors have a big lead in the 386-based server business, and IBM
- still hasn’t shipped a 33 MHz 386 machine.
-
-
- _____________________________
- The IBM Announcements
-
-
- New CPUs
-
- The new computers from IBM are:
- • A 25 MHz 386 version of the Model 80. Previously the fastest version of
- the Model 80 was 20 MHz.
- • Two new configurations of the 20 MHz Model 80.
- • A 386sx-based tower machine called the Model 65sx.
- • A new configuration of the P70 portable.
-
- Prices for the new Model 80s are pretty aggressive--about 17% below previous
- pricing for comparable IBM machines. The new Model 80s will help IBM, but they
- aren’t breakthroughs compared to the Compaq SystemPro and other server/PCs that
- are starting to appear. The Model 65 looks unimpressive (who wants a
- 386sx-based server?), and the new portable isn’t likely to move in bigger
- volumes than the current niche product (more on that product below).
-
- US Prices:
-
- Model 80 386 A21 $10,695
- 80386 (25 MHz), 4 MB RAM, 64K cache, SCSI card, 120 MB hard drive
- Model 80 386 A31 $13,195
- 80386 (25 MHz), 4 MB RAM, 64K cache, SCSI card, 320 MB hard drive
- Model 80 386 121 $7,495
- 80386 (20 MHz), 2 MB RAM, SCSI card, 120 MB hard drive
- Model 80 386 321 $9,895
- 80386 (20 MHz), 2 MB RAM, SCSI card, 320 MB hard drive
- Model 65 SX 061 $5,295
- 80386sx (16 MHz), 2 MB RAM, SCSI card, 60 MB hard drive
- Model 65 SX 121 $5,995
- 80386sx (16 MHz), 2 MB RAM, SCSI card, 120 MB hard drive
-
- The machines all have Micro Channel slots. The Model 80s have four 32-bit
- slots and four 16-bit slots. The Model 65s have eight 16-bit slots.
-
- Prices compared to the competition (configured with monitors, etc.):
- Compaq 386/33 (33 MHz 386), 4MB RAM, 84MB HD $13,200
- • IBM PS/2-80 (25 MHz 386), 4MB RAM, 120MB HD $13,140
- IBM PS/2-70 (25 MHz 386), 4MB RAM, 60MB HD $12,335
- Macintosh IIfx (40 MHz 030), 4MB RAM, 80MB HD $11,745
- • IBM PS/2-80 (20 MHz 386), 4MB RAM, 115MB HD $10,635
- Macintosh IIci (25 MHz 030), 4MB RAM, 80MB HD $9,897
- Compaq 386/25e (25 MHz 386), 4MB RAM, 60MB HD $8,738
-
- IMPACT ON APPLE: Very little. The new products are more aggressively-priced
- than previous systems, but IBM’s lack of a very fast 386 box continues to be a
- handicap in competition against the Macintosh IIfx. None of the IBM tower
- systems have ever sold very well, and we don’t expect that to change.
-
-
-
- Lower-end Transportable
-
- IBM announced a lower-end version of its Model 70 Portable. This new version
- of the P70 has a 30 MB hard disk and 2 MB of RAM, and is priced at $5,995.
- Previously, IBM's lowest-end P70 had a 60 MB disk, and 4 MB of RAM, and was
- priced at $7,695.
-
- IBM has not had much success with its P70. Part of the problem had been its
- high price. However, a large part of its problem (literally) was its size. It
- has a large footprint and weighs 21 pounds. Also, the P70 does not run on
- batteries, so users always need to be near an electrical outlet.
-
- We believe that this lower-priced version of the Model 70 portable will still
- see limited success, primarily because of its hefty size.
-
- IMPACT ON APPLE: Minimal.
-
-
-
- Price Cuts
-
- IBM cut the prices of the Model 30, 60, and existing Model 80s. The cuts on
- the 30 are probably meant to close them out in preparation for new products,
- while the cuts to the older Model 60s and 80s bring them in line with the new
- machines.
-
- Prices:
- Was Is Now
- Model 30 (8 MHz 8086, floppy) $1,695 $1,395
- Model 30 (", 20MB HD) $2,255 $1,925
- Model 60 (10 MHz 286, 44MB HD) $5,295 $4,195
- Model 60 (", 70MB HD) $5,795 $4,645
- Model 80 (16 MHz 386, 44MB HD) $6,995 $5,395
- Model 80 (", 70MB HD) $7,995 $6,095
- Model 80 (20 MHz, 115MB HD) $8,995 $6,995
- Model 80 (", 314MB HD) $11,295 $9,395
-
- IMPACT ON APPLE: Because the systems cut were not IBM's best-sellers, the
- impact on Apple should be fairly small. Although the Model 30's price didn't
- drop dramatically, it is the lowest-priced modular system from IBM since the
- PCjr. The US street price of floppy-based Model 30 systems will probably cross
- below $1,000, which is an important threshold for some price-sensitive
- customers. IBM is turning up the heat on pricing, and future price cuts the
- company’s more popular desktop systems would not be a surprise.
-
-
- New Laser Printer
-
- The LaserPrinter E is a five page per minute version of IBM’s 10 ppm
- LaserPrinter. It’s priced at $1,495, and is aimed at Hewlett-Packard's popular
- LaserJet IIp, which is also $1,495. From Apple’s point of view, the most
- important aspect of new IBM printer is that it can be upgraded to PostScript
- for $998. IBM claims it now sells the cheapest PostScript printer on the
- market (although that could change any day, when HP releases its PostScript
- upgrade for the IIp).
-
- The LaserPrinter E compares well to the LaserJet IIp. The IBM product carries
- the same price as the IIp, but has a top speed of 5 ppm (HP is 4 ppm), somewhat
- more robust paper handling, and an upgrade path to 10 ppm (HP has none).
-
- Prices:
-
- LaserPrinter E $1,495
- PostScript option (17 fonts) $499
- Premium PostScript Option (29 fonts) $899
- 1MB RAM upgrade (needed for PostScript) $499
- Upgrade to 10 PPM $1,099
-
- IBM also cut the price of its 10 ppm LaserPrinter from $2,595 to $2,395. This
- matches the pricing of the new HP LaserJet III, announced earlier this month.
- The PostScript option can be added to either of the IBM laser printers,
- although the 10 ppm printer also needs a 3.5MB RAM upgrade in order to print at
- full speed (it prints at a maximum of 6 ppm otherwise).
-
- IMPACT ON APPLE: IBM in the past has not marketed printers aggressively to
- Apple customers, and we don’t expect that to change (the PostScript option
- apparently does not have a LocalTalk connector). IBM's main target is HP.
- However, the laser printer market as a whole is getting more and more
- competitive. Neither IBM nor HP seems willing to back off, so we expect more
- of the same in the rest of 1990. The ball is now back in HP’s court.
-
-
-
- SCSI Boards
-
- As expected, IBM added a SCSI option to its computers, in the form of two SCSI
- expansion boards. Both require the Micro Channel architecture, meaning that
- they won’t work on machines below the Model 50. The “Micro Channel SCSI
- Adapter” is a 16-bit MCA board costing $495 (maximum data transfer rate 8.3
- megabytes per second). The “Micro Channel SCSI Adapter with Cache” is a 32-bit
- SCSI card with a 512K memory cache (maximum data transfer rate 16.6 megabytes
- per second). It costs $995. For comparison, the maximum transfer rate on
- Apple's SCSI implementation is 10 megabytes per second.
-
- You can chain up to seven SCSI devices on a single board, and computers can
- contain multiple SCSI boards.
-
- The cache in the high-speed card “allows system memory to be dedicated totally
- to running the application,” according to IBM. This implies that the
- lower-cost SCSI card uses an area of system memory, which could introduce
- compatibility problems with some DOS applications.
-
- IMPACT ON APPLE: Years after Apple adopted it, SCSI is finally winning
- acceptance in other PCs. Although this could reduce the perceived
- differentiation of Macintosh, it can be turned into a sales tool:
- • Apple’s leadership position is reinforced. Apple’s quick adoption of
- SCSI shows how much faster Apple can innovate compared to the IBM-compatible
- industry.
- • IBM uses SCSI as an expensive option, limited to its Micro Channel
- machines. On Macintosh, SCSI is standard. Also, now that SCSI is an option
- for IBM, we can bundle it with IBM’s PCs when comparing their cost to
- Macintosh.
-
-
-
- New Hard Drives, CD Drive
-
- Along with the SCSI option, IBM introduced three new 3.5-inch SCSI hard drives:
- 60 MB, 120 MB, and a 320 MB screamer (access time is just 12.5 ms). Prices are
- 15% to 33% below comparable non-SCSI drives from IBM.
-
- The PS/2 CD-ROM drive is a standard 600 MB read-only 5.25-inch drive, available
- in internal or external versions. IBM is the first major PC manufacturer to
- offer an internal CD drive in the US (NEC offers one in Japan). Pricing on the
- IBM drive is not very aggressive.
-
- IBM positions the CD drive as a server resource, allowing multiple people to
- access CD databases and other information.
-
- Prices:
- (Remember that if your IBM CPU doesn’t come equipped with a SCSI card, you have
- to purchase one to use either the CD-ROM or SCSI drives.)
-
- 16-bit SCSI card $495
- 32-bit SCSI card $995
-
- 60 MB SCSI $1,200
- 120 MB SCSI $1,920
- 320 MB SCSI $5,500
-
- Internal CD $1,250
- External CD $1,550
-
-
-
- New Monitor
-
- The Color Display 8515 is a 14-inch color monitor, compatible with the 8514/A
- high-resolution video board (256 colors, 1024x768 pixels). Price is $950 --
- about $500 less than the cheapest 8514-compatible monitor available from IBM in
- the past.
-
-
-
- OS/2 Extended Edition 1.2
-
- IBM announced the availability of OS/2 Extended Edition Version 1.2. This
- product had initially been targeted for fall 1989 availability, and had been
- postponed until March.
-
- OS/2 Extended Edition includes the Standard Edition of OS/2 and adds the
- Database Manager, the Communications Manager, and the LAN Requester.
-
- The most visible improvement in OS/2 EE 1.2 is that the Database Manager, the
- Communications Manager, and the LAN Requester are now Presentation
- Manager-based. This means that they have the same graphical appearance as OS/2
- Standard Edition.
-
- Beyond that, the Communications Manager now supports additional protocols: SNA
- LU0, X.25, Ethernet DIX Version 2.0, and IEEE 802.3, and SNA LAN gateway. The
- Database Manager now allows workstations on a LAN to operate as database
- servers and/or requesters.
-
- IBM also announced a new version of its OS/2 networked application development
- product, Easel. The new version supports use of APPC (Advanced
- Program-to-Program Communications), a protocol that facilitates the
- distribution of program tasks between a PC and other computers on a network.
- The new Easel also can access the OS/2 Database Manager, and has enhanced audio
- functions that can give musical or voice responses within a program.
-
-
- ____________________
- We welcome your comments and questions. Please link them to COMPETITION.
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