HP, Compaq merger raises eyebrows of customers, investors


September 9, 2001



Hewlett-Packard Co.'s recently announced plan to buy Compaq Computer Corp. may be the computer industry's biggest merger, but it apparently isn't settling well with either company's customers or stockholders.

The combined companies, under the HP name, could overtake Dell, which is No. 1 among PC manufacturers.

But analysts bring up the fact that neither company has performed to its potential. Merging them could only complicate things, analysts suggest.

One analyst said the merger might be more of an opportunity for Dell to grow.

Compaq's stock value dropped 16 percent, and HP lost nearly one-fourth of its value after the merger deal was announced.

Investors in both companies have voted with their portfolios; in fact, their stock values have dropped enough so the originally announced $25 billion merger is now worth about $19 million.

Industry watchers are looking at the merger with caution, though the real losers may be owners of Compaq or HP computers that wind up as orphaned products as a result of the merger.

The merger will require the approval of various U.S. and international regulatory agencies, so we'll be hearing about this deal for some months to come.

PC BUYING GUIDE. If you're going to be in the market for a new computer soon, you probably should pick up the October issue of PC World magazine.

The magazine has a shopping guide that looks not at various computer models, but various places to buy that new PC. They attempt to answer the question, "Which is better, shopping in the store or shopping online?"

The answers will probably surprise you.

PC prices continue to inch downward, and PC World buyers went shopping for a nicely configured computer system, and their advice? You better shop around.

Shopping for a PC on the Web was deemed superior in most comparisons. The areas where in-store shopping won included being able to try before you buy.

The magazine's tips for PC shopping include:

• Know what you want and know what you want to do with your PC and how much you can spend.

• Find the right staff. The quality of a merchant's sales staff can vary from store to store and from person to person. If you don't find one helpful, find another one.

• Hunt for special deals.

• Buy the monitor separately. You may get a better deal if you buy a different brand's monitor. If you buy online, you'll save big on shipping by buying a monitor locally.

• Get the return policy in writing.

• Don't be afraid to play hardball. Ask the salesperson if there's anything she or he is willing to toss in to close the deal.

PAPAL AUDIENCE AUCTIONED. There's no telling what sorts of things people will put up for auction on eBay and other auction Web sites. First it was Jimi Hendrix's boyhood home up for auction online, then it was Bob Dylan's and then Madonna's home went up for auction.

Scottish whisky makers Chivas Regal are marking the 200th anniversary of the founding of the brand's creators, Chivas Brothers, with an auction of 450 lots of some of the "most wanted and unobtainable items in the world."

The auctions will raise money for charities around the world.

What constitutes the "most wanted and desirable items in the world?"

For starters, there's a balloon ride with Virgin Airlines tycoon Richard Branson; a dinner with actor Jeremy Irons; an opportunity to discuss Shakespeare with British director Kenneth Branagh; a chance to join the Moscow Circus; visit a diamond mine in Africa, or have an audience with Pope John Paul II.

Visit eBay.com for details, or www.chivas.com.

Comments and questions about this column may be sent to jbrooks@myoldkentuckyhome.com, or visit www.myoldkentuckyhome.com on the World Wide Web.

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