Compaq has broken the $1000 desktop barrier, shipping its much touted iPAQ Internet device for the commercial market.
The devices, which carry a starting price of $995 including GST, signal the beginning of "thinned down" business boxes where Internet functionality is more important than hardware.
The iPAQ is the industry's first "Legacy-Free" Windows 2000 device, using USB ports in place of ISA/PCI expansion slots or legacy ports.
"It is the first time we have been able to offer a price below $1000. We have taken out the components which users don't often need, such as PCI slots and floppy drives," said Jeremy Burgess, Compaq's product manager, Internet devices. "So we have managed to lower the cost, including savings associated with the GST."
A version of the iPAQ desktop with support for legacy ports has also been developed.
The company will sell the boxes through its Compaq Connect stores, the Compaq Web site and the Compaq call centre, as well as through authorised Compaq resellers. It will be distributed through Dicker Data, Tech Pacific and Ingram Micro.
Compaq has based its iPAQ around the Internet-based computing model, moving away from complex hardware and towards thinner, stable technology, according to Burgess.
"The iPAQ desktop represents the first business computer specifically designed for companies moving toward an Internet-based computing model."
Compaq will offer eight models in its iPAQ range; a change from its usual prolific product offerings.
"It allows us to reduce the cost of the box in terms of obsolescence. It also makes it easier to deliver," he said.
Compaq has sacrificed top of the range technology for stability in the system, saying many businesses are more concerned with how their hardware performs than having the fastest chip.
"It is not the latest and greatest, but it is very functional. For example, we have used mainstream processors that are not necessarily the fastest. User are less concerned with the MHz race these days. They are more concerned about stability," said Burgess.
"There are positive and negative aspects [to this marketing strategy]. You don't have the same choice of products, but a lot of customers are moving towards mainstream technology," he added.
The $995 iPAQ does not include a monitor. It comes standard with 64MB of memory whereas most systems use 128. However, this can be upgraded to a maximum 512MB and the multibay allows the user to choose the drives they need or even share a drive amongst a group of users.