September 28, 2005

Dell Goes Upscale with PCs for Gamers, Enthusiasts

SAN FRANCISCO (Reuters) - Dell Inc. is launching a line of upscale and more expensive computers after aggressive price-cutting led to lower-than-expected revenue growth last quarter.

The company on Wednesday is unveiling three high-powered desktop computers and a notebook "aimed at tech enthusiasts, gamers and buyers who prefer the best products, services and individualized support," Dell said in a statement.

The new XPS series computers start at $1,099 and a notebook version starts at about $2,700. That compares with desktops selling for as low as $299 on the company's Web site.

In addition, Dell is introducing its first high-definition televisions, with a 50-inch model priced at $3,799 and a 32-inch at $1,799.

The roll-out comes after the company in August reported second-quarter revenue that rose less than analysts had expected.

Chief Executive Kevin Rollins at the time said prices for Dell's PCs were "down more than we would have liked" but added that the industry wasn't experiencing a pricing problem.

Dell is offering expanded services to customers who buy the new products, making available "highly trained" agents assigned to individual customers, according to the Round Rock, Texas, company's statement. Customers can also get quick answers through online chats with product advisors.

Asked about reports of rising consumer complaints recently, Rollins said his company closely tracks such reports and its data show customer service trends have been improving, not declining. Because Dell sells an ever-greater number of PCs each year, the absolute number of customer service complaints may be growing, but as a percentage of the overall number of customers, Dell's customer service continues to improve, he said.

Dell is scheduled to introduce the products Wednesday at a briefing in New York City attended by Chairman Michael Dell.