Monday, May 12,2008 @ 11:35pm
Dell to phase out XPS gaming PCs to push Alienware
Next month Dell will begin phasing out four of its popular XPS gaming systems, in favor of the high-end PCs that are part of its recently acquired Alienware PC line. The surprising move is part of its continued turnaround efforts--along with an expected design overhaul in its Inspiron line-- after slipping behind rival HP in overall PC sales and struggling to achieve profits in consumer PCs, the Wall Street Journal reports. With the focus on the Alienware line, Dell says that a combined gaming design and development unit will focus on the seven current Alienware models, which has lost some "mojo," according to one analyst. Dell also noted that the gaming market, which focuses machines with high-end processors and GPUs priced at nearly three times the price of the average consumer PC, is strategically important because gamers' purchasing decisions influence other PC buyers.
In contrast to HP's acquisition of the Voodoo PC line, Dell has left Alienware to develop and market its own products, while hoped to boost Alienware's profits by reducing costs of components by leveraging its volume purchases with manufacturers.
Dell's current XPS line includes four models, ranging from $1,199 to more than $7,000, while Alienware's models, not available on Dell's website, include four different models starting at $999.
While the Alienware acquisition helped lift Dell to the top of the lucrative gaming PC market, the overlap in PC models cut into Alienware sales. Noting that the Alienware brand remains an admired brand among gamers," Dell admitted that there is a challenge to remain different and keep an "edgy, maverick style that resonates with gamers."
The report says the new team "will focus on a line of new products that go beyond the colorful, but "passé" according to Dell execs. While trying to focus on using new materials for Alienware exteriors, Dell "insists there is plenty of runway left for the brand."