HP's Corel move bypasses Australasia

Hewlett-Packard (HP) is bundling CorelWordPerfect 10 and Quattro Pro 10 with its new Pavilion desktop PCs in the U.S., but don't expect to see Microsoft products disappearing from Pavilions in Australia or New Zealand any time soon.

Ottawa-based Corel says it will provide its WordPerfect 10 word processor and Quattro Pro 10 spreadsheet to Hewlett-Packard for inclusion on all new HP Pavilion desktop computers sold in North America, starting next month. Also featured as part of the WordPerfect Productivity Pack is a customized task manager to help users complete projects.

The deal follows a similar deal with Dell through which Corel will provide the productivity pack for selected models of Dell Dimension and Inspiron computers.

HP New Zealand communications manager Pamela Bonney says the company has no plans to change desktop application providers.

"The decision to ship Corel with Pavilions in North America is based on their market and customer needs."

Corel strategic relations boss Steve Houck says under the deals with HP and Dell, the Microsoft Works software that has been offered on the machines in the past will be replaced.

He estimates about 3 million HP Pavilions and about 1 million Dell machines will ship in the next year with WordPerfect software, based on numbers from IDC.

Users will be offered inexpensive upgrade paths to get the full WordPerfect 10 office suite, which features presentation and database applications and more. HP users will be able to upgrade for a special US$99 price.

Analysts say the deals are good for Corel but won't make much of a dent in the office suite wars.

"What can be a good business for Corel ... doesn't necessarily change the enterprise dynamics," says Jonathan Eunice, an analyst at Illuminata in New Hampshire. "They figure they lost the big war years ago, so now what can they do with this asset?" For manufacturers like HP and Dell, the deal probably means lower costs and elevated profits, even if by small measures, he says.

"Down at that level of platform, price is all," Eunice says. "Any US$5 or US$12 that you can switch out of anything is usually (good)."

David Smith, an analyst at Gartner Group says that similar bundling deals made in the past haven't really meant much in terms of future increased market share.

What is different today, he says, is that Microsoft's recent and well-publicized licensing and pricing changes have angered many users, giving them the incentive to look elsewhere when they can.

Corel's US$99 upgrade may be something that at least some users will consider, he says.

"It makes sense to seed the market with some low-cost or free software and then get them to upgrade. It's not something that's going to revolutionize the world or keep Microsoft up at night, but it (Corel) could make some money."