UK - Context Offers Retail Watch Update Services 09/20/95 LONDON, ENGLAND, 1995 SEP 20 (NB) -- After ten years of concentrating its market research activities on the dealer side of the computer and information technology (IT) sales channels, Context is moving its services into the retail channel with a new Retail Watch service. Jeremy Davies, a director with Context, told Newsbytes that the Retail Watch service centers around two main elements, a weekly update service on events in the European side of the retail market, and a data service, which offers pricing details on the PC, printer, and peripherals marketplace. "The service covers the whole of Europe, and includes a typical pricing service where we select a PC, printer, and other peripherals, and offer typical selling price comparisons," he said. He added that pricing on the new service varies depending on what data is required, and what the customer plans to do with the data. "Pricing starts from UKP5,000 a year. We're setting up a new division within Context, as we predict that the retail side of the channel is going to be of major importance in the years to come," he said. According to Davies, Retail Watch was set up because the computer industry was having a tough job keeping up with all the changes in, what is fast becoming, a major force in the channels for PC and printer sales in Europe. "For vendors, having to get involved in retailing hasn't only meant coping with country differences...retail for many of them is a whole new mindset," he explained. According to Context, it has been forecast that the consumer and business retail channel will become the major outlet for PCs in Europe within the next four years. The company says that, fueling the interest, are surveys like the one published recently by the UK computer publication Computer Weekly in association with Kew Associates, which found that consumer spending on PCs in the UK jumped 40 percent to over UKP1 billion last year compared with a 21 percent rise in corporate spending over the same period. Context claims that the survey noted that corporate spending was down from a 30 percent increase the year before. The Context Retail Watch report tracks pricing and promotional activity from the IT market leaders in the consumer and business retail channel in six European countries. Each country report analyzes pricing for all the products sold in the retail outlets tracked. At the same time, the results of a store "walk-in" are analyzed with particular reference to any promotional activity, such as bundling deals and finance offers. Special attention is also paid to merchandising. The main elements of the Retail Watch service include a weekly analysis of news, products, pricing and promotional activity, a weekly pricing monitor of the major models and configurations on sale, details of regional promotions and a monthly in depth update on instore merchandising. (Steve Gold/1990919/Press Contact: Sukie Read, Communications Manager, +44-171-937-3595, Internet e-mail sread@context-ecis.co.uk; Reader Contact: Context, +44-171-937-3595, Internet e-mail jdavies@context- ecis.co.uk) IDC Sees Compaq Retaining PC Sales Lead In 1995 09/20/95 HOUSTON, TEXAS, U.S.A., 1995 SEP 20 (NB) -- Compaq Computer Corp. (NYSE: CPQ) will apparently retain its leadership in personal computer shipments for 1995, but not by much, according to a report released by the International Data Corp. (IDC). The international research and analysis company made its predictions at its annual one-day PC Market Outlook conference. IDC forecasts that Compaq will hang on to its worldwide sales leadership by about two market share points over IBM and Apple Computer Inc. Those two companies are in a dead heat for second place. Compaq is also expected to retain its domestic sales lead, but will drop a point in market share in the US. IDC said Apple and Packard Bell are in a tight race for second place in domestic sales, with Packard Bell currently within a point of Apple and IBM in fourth place. Compaq has occupied the top sales spot each quarter since the beginning of 1994, and also captured the top spot for that entire year, with IBM ranked second, followed by Apple, NEC Corp., Packard Bell Electronics Inc., and Hewlett-Packard. IDC said the release of Windows 95, growth in the home and small business markets, growth in rebounding or expanding regional economies, demand for online access, new graphics and data compression technology, and network management tools for business, will continue to drive demand for PCs. Potential market inhibitors include higher costs for some memory devices, some component shortages and a potentially slowing national economy. (Jim Mallory/19950919/Press contact: Compaq, 713-374-0484) SPA Reports Flat Software Sales In Western Europe 09/20/95 WASHINGTON, D.C., U.S.A., 1995 SEP 20 (NB) -- Personal computer applications software sales in Western Europe were up only slightly over a year ago in the second quarter, the Software Publishers' Association has reported. And sales of both DOS and Apple Macintosh applications were down. The figures released by the SPA are based on data from 38 US-based applications software vendors. Anne Griffith, a research analyst at the Washington-based software trade association, told Newsbytes the numbers do not include European-produced software and probably represent roughly 85 percent of the total sales of US-produced software in Western Europe. A few US-based producers do not participate in the study, and the SPA does not attempt to extrapolate its results to account for them, she said. However, Griffith said the growth rates given are probably quite close to those for the entire market. According to the SPA, Western European PC application sales by the participating vendors amounted to $423 million in the second quarter of 1995, up one percent from the second quarter of 1994. Sales of Windows applications were up six percent at $388 million. Sales of DOS applications were down 35 percent to $20 million, which is no surprise given Windows' continuing takeover of the DOS market. Perhaps more surprisingly, though, sales of applications software for Apple's Macintosh fell 28 percent year-over-year, to $13.5 million in the quarter. "I haven't got a good reason" for the drop in Macintosh application sales, Griffith said. "I'm just not certain exactly what's going on." For the first half of the year, Windows applications sales by the surveyed vendors were up nine percent to $852 million. DOS application sales fell 42 percent to $46.8 million, and Macintosh software sales were down 20 percent at $34.4 million, the SPA said. Over all, applications sales were up three percent year-over-year in the first half. According to the SPA, Windows packages now account for 91 percent of the sales of US-made applications software in Western Europe. Griffith said sales of OS/2 applications were up 39 percent in Western Europe in the second quarter and 15 percent in the first half. However, she cautioned that this large increase came on a far smaller total than for Windows. Griffith would not say what total OS/2 applications sales were in the quarter, saying the SPA wants to keep some of its data secret for its members. Based on the totals that were released and the statement that Windows application sales represented 91 percent of the total in the first half, it appears clear that OS/2 application sales added up to less than $4 million in the first half. The SPA collected data for six operating systems in all. The SPA said price pressures are keeping sales revenues down in Western Europe by reducing unit prices almost as fast as unit volumes rise. Unit sales have been growing by 40 to 50 percent per quarter, the software manufacturers' trade association said, but prices have been dropping sharply over the past year. (Grant Buckler/19950919/Press Contact: Anne Griffith, Software Publishers' Association, 202-452-1600 ext 360; Sally Lawrence, Software Publishers' Association, 202-452-1600 ext 320) ****Losses For Phone & Cable Firms Predicted 09/20/95 SAN FRANCISCO, CALIFORNIA, U.S.A., 1995 SEP 20 (NB) -- Competing cable and phone companies vying in the new broadband multimedia marketplace are heading into a "bloody stalemate," says Mercer Management Consulting. In a study just published, Mercer projects revenue potential for consumer communication, information, and entertainment services to be in excess of $100 billion over the next ten to fifteen years, but this will fall far short of covering costs. P. William Bane, vice president of Mercer Management Consulting, told Newsbytes, "Europe and the United States have taken different paths toward a digitized communications network. Historically, the television network has been separate from the telephone network, and both were separate from any computer networks. With digitization all these networks merge. In Europe, they are planning one monopolistic regulated digitized network, in the United States we are trending toward deregulation and multiple competing networks." He said: "At the very least the competing cable and phone companies will be installing separate digitized networks to the home. We will be seeing at least two networks in every community, and this means for the next few years we are going to have broadband capacity that will exceed any concept of demand. When capacity grows faster than demand you end up with companies loosing money." "This is going to be bloody," said Bane, "because revenues will not match costs for a long time, and its a stalemate because both the cable and phone companies have no choice but to take this life-or- death plunge into the digitized network." Mercer predicts revenue growth for local consumer broadband communications, entertainment, and electronic services will be significant, but much less than the market's current expectations. Mercer sees growth from $60 billion today, to $100 billion by 2010. Entertainment holds the greatest future revenue growth potential ($20 billion), but incremental demand for entertainment depends upon the arrival of a broadband network capable of offering full video-on-demand and time-shifted TV, says the study. Electronic services offer the greatest near-in potential ($5 billion to $10 billion). In the short term, revenue can be enhanced with widespread access to ISDN (integrated services digital network) and cable modems. These interim technologies can profitably support new services in the years prior to deployment of full service networks, says Mercer. The report predicts that videophone has substantial revenue potential ($10 billion) if picture quality is improved, and equipment and monthly pricing levels are reduced to reasonable levels. Quality of service performance, broad service choice, and ease-of-use will be critical to unlocking demand. "Monopoly break-up combined with new technologies leads to capacity and fixed costs growing faster than demand, not a pretty picture from a financial point of view," said Bane. "The shortfall can only be covered by fostering growth through a combination of vision, innovation, and invention. This should include aggressive, software- intensive new product development, alliances, and opening up networks and content offerings to encourage market speculation." Mercer Management Consulting Inc. is headquartered in New York, and employs 1,000 people in 12 offices throughout the United States. The study was conducted with interviews of 850 randomly chosen United States consumers. In-depth interviews with industry executives also took place. (Richard Bowers/19950920/Press Contact: Howard Bailen, Mercer Management Consulting, 212-345-7506) Hal Computer Ships 64-bit SPARC Workstations 09/20/95 SAN JOSE, CALIFORNIA, U.S.A., 1995 SEP 20 (NB) --HAL Computer Systems, a Fujitsu company, has introduced a new line of 64-bit Sun Microsystems' SPARC workstations. The company claims the HALstation 300 Series workstations will run existing 32-bit SPARC applications up to 3.3 times faster than any current system. Other manufacturers are already delivering SPARC workstations based on 64-bit hardware and 32-bit software, but HAL Computer Systems claims to be the only company delivering a 64-bit operating system. Speaking to Newsbytes, Clark Hoyle, director of workstation marketing, said, "We are announcing the world's first 62-bit SPARC workstation. These workstations are fully compatible with Sun Microsystems 32-bit SPARC operating system. Users can get all the performance and functional advantages of next-generation 64-bit systems without having to replace their enormous investments in existing software, networks, and peripherals. "HAL's new SPARC64/OS 2.4 operating system is based on, and compatible with, Sun's latest Solaris 2.4 operating system. Our tests indicate that the HALstation 300 Series workstation can run existing 32-bit Solaris applications up to three times as fast as any other workstation. The system is able to run existing Solaris-based applications software without modification, a capability we will back up with a full money back guarantee," said Hoyle. "A 64-bit chip is only half the story -- you need 64-bit system software to harness its power," said Scott Metcalf, president of HAL Computer Systems. "We're giving users the entire 64-bit system they need to solve their next-generation of larger, more complex problems." HAL also claims the new system architecture reduces long-term maintenance expenses, including configuring, servicing and upgrading. The workstation is built entirely with a new class of component, the customer replaceable units. They claim that, with nothing more than a single screwdriver, a user can strip, and rebuild a HALstation in less than 25 minutes, touching no more than nine screws in the process. The mid-range HALstation 330 with a 100 megahertz (MHz) CPU (central processing unit) is priced starting at $23,010 with a base configuration of two gigabyte (GB) disk storage, 64 megabyte (MB) RAM, four SBUS slots, keyboard, mouse, and a 17-inch color monitor. The high-end HALstation 350 with a 118MHz CPU is priced starting at $33,055 with a base configuration of 2GB disk storage, 64MB RAM, four SBUS slots, keyboard, mouse, and a 20-inch color monitor. The US master distributor for the Hal workstation is Ingram Micro. In Europe, ICL will distribute the HALstation 300 Series. Parent company Fujitsu Ltd. of Japan will distribute the workstations throughout Japan and the rest of Asia. (Richard Bowers/19950920/Press Contact: Carol Manning, HAL Computer Systems, 408-379-7000) Sega Selling 32-bit Game Player For $99 09/20/95 REDWOOD CITY, CALIFORNIA, U.S.A., 1995 SEP 20 (NB) -- Sega of America Inc. announced that the suggested retail price of the Genesis 32x, the arcade upgrade to the Genesis home entertainment system, has been reduced to $99. Previously priced at $149, the upgrade offers a middle ground between the 16-bit Genesis system and the $399 32-bit CD-ROM Sega Saturn system. Earl Mallit, marketing manager for Sega of America, told Newsbytes, "We are offering the 32x as an affordable 32-bit arcade system. If you can't afford $399 for a full 32-bit CD-ROM system, the cartridge based 32x will, for $300 less, still give a 32-bit arcade look." "We've been able to cost-reduce 32x, keeping it the most affordable system for 32-bit gaming on the market," said Chrissie Huneke Kremer, director of marketing. Sega tested the $99 price-point for Genesis 32x over the past four weeks. "Our early sales reports show that the $99 price point has resulted in an increase in Genesis 32x sales in our top markets," added Kremer. "And we expect to see a more significant increase as more of our fall titles roll out." One of the most popular fighting arcade hits ever, "Virtual Fighter" will make its way onto the 32X on October 10 with other titles coming soon. "'Kolibri,' a game where a high-flying hummingbird must save the planet from an evil asteroid's deadly emissions; 'Star Trek: Starfleet Academy,' the only Star Trek flight simulator on any Sega platform; and 'Spiderman: Web of Fire,' will be coming out exclusively on the Genesis 32x this fall," said Mallit. Sega of America, a subsidiary of Tokyo-based Sega Enterprises Ltd., is responsible for the development, marketing and distribution of Sega products in the Americas. Sega Enterprises is a $4 billion company with operations on five continents. (Richard Bowers/19950920/Press Contact: Terry Tang, Sega of America, 415-802-3218)