Date: Friday August 22, 2003 12:26:00 pm
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More on the Rivalry: Dell’s slap in the face will test HP’s pricing agility 
It didn’t take Dell long to respond. Less than 24 hours after rival Hewlett-Packard reported its personal computer division lost money in its latest quarter, Dell tightened the screws on its rival by announcing it was cutting prices on computers, printers and other Equipment by up to 22 per cent. Dell’s move was a slap in the face, given that HP’s woes were due in part to aggressive price cuts on personal computers that it made in order to compete with Dell. And despite HP’s below-market PC prices in the last quarter, Dell continued to increase its market share lead over HP and all other PC makers.
In one well-timed move, Dell again demonstrated that its direct sales model allows it to be extremely flexible while its low cost manufacturing enables it to set the tone on pricing.
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