250 staff laid off as GE Capital quits PC business
GE Capital IT Solutions (GECITS), which includes P&P's desktop sales operation in Rossendale in the NorthWest of England, is pulling out of the PC sales business.
The move by the fourth largest reseller group in the UK will mean the loss of at least 250 jobs, and follows a three month consultation period with its workforce.
GECITS bought the P&P desktop business from Skillsgroup in January, 1998, for 26.5 million pounds. Now the business is no more.
Plans call for GECITS' value-added solutions (i.e. non-PC sales) to be moved to a central site in the South-East England, with regional operations in London and the North of England.
While rumours are flying around the industry about the real reason for the closure, it seems that direct sales have killed off the operation more than anything else.
Computerland confirms Y2K sales slowdown
Computerland, another major IT reseller, has warned its shareholders that its full calendar year results will be disappointing, as a direct result of the Y2K-related sales slowdown.
The group says that delays to project work contracts had affected its professional services division and its training business, as well as its computer products sales, which were sharply down in September and October.
Interestingly, however, the company says that its support services division had performed well, but this would be more than offset by the weak product sales.
In a press statement issued in late November, Computerland said that "the overall effect of our lower than expected product sales and the delays caused to project work by the Year 2000 effect will be a disappointing outcome for the year as a whole."
IBM offers small business cashback incentive
Even the mighty IBM is not immune from the Y2K-related PC sales slump, as it started a Christmas Cashback promotion in mid-November. The company is offering its small and medium business sector an incentive scheme offering rebates on selected hardware purchased this year.
Customers can receive rebates of up to 240 pounds per item, on a limit of 20 desktops and Thinkpad notebooks and two IBM Netfinity servers.
Ermammo Zoboli, IBM's small business sales director said that the scheme aimed to make IBM kit more affordable for companies in this sector.
"Our cashback programme helps those customers who always longed for IBM quality and reliability, but wanted them at a more affordable price," he said, adding that claim forms are being handled on the IBM Web site and must be in by the end of January, 2000.
Ideal Hardware
Ideal Hardware taps into Fujitsu-Siemens `new for old' programme Ideal Hardware, meanwhile, sales says it has actually seen a rise in its PC sales business, thanks to the the Fujitsu Siemens `New for Old" sales promotion programme which will runs until the end of December.
Despite original channel fears of a slowdown in sales owing to the Y2K problem, Ideal says that its research shows that some 6.5 million PC units were shipped in Europe in the third quarter of 1999, an increase of 19.3 per cent over the same period last year.
According to Dan Petrovic, Ideal's product manager, Fujitsu-Siemens' extension of its new-for-old offer is a reflection of buoyant market conditions in the pre-millennium period, a time in which many had predicted an industry meltdown.
"It clearly demonstrates the newly merged company's customer commitment. It is offering end-users a win-win situation in which customers can upgrade to Y2K compliant technology in a hassle-free, cost-effective way, with a reduced risk factor," he said.
The Fujitsu-Siemens trade-in promotion covers a wide range of branded products. Customers with PCs from suppliers such as Compaq, Dell, BP, IBM, Toshiba and Digital are also able to benefit from the promotion.
With desktop models available from 499 pounds (including monitor) and leading edge lightweight notebooks from 1,149 pounds, Ideal says that the upgrades are hassle-free.
Once the customer has purchased the new Fujitsu-Siemens PC of their choice, they simply need to contact Amtrak who will collect their old PCs free of charge providing the pick up involves 30 or more units.
The only stipulations to meet are that the trade-in products are complete and working, securely packaged and clearly labelled as `Siemens trade-in.'
Microsoft & BT offer MS Office 2000 online
Microsoft has started a trial programme under which Internet users can rent time on a PC server - across the Web - running Microsoft 2000.
The programme, which is expected to go pan-European early in the New Year when Office 2000 starts shipping worldwide, allows PC users to pay-as-they-go and either try out MS Office 2000, use the applications while on the road, or simply avoid the capital costs of buying the software.
Dealers are less than pleased with the move, as it essentially erodes their sales base for the new Microsoft suite of software.
Their only consolation is that Jeremy Gittins, Microsoft's group marketing manager, admits that the service could be slow to take off - at least until Internet users get faster connections to the Internet.
"It will be difficult to predict what stage it will take off," he said, adding that, despite this, Microsoft is convinced that, at some stage over the next few years, it will really take off.
"We may not necessarily see huge volumes of users during the pilot, but we hope to get the volume of customers to learn from their experiences," he said.
Microsoft claims that its Office-on-Tap service, which started in the UK and the US on a pilot basis just before Christmas, will disadvantage resellers. It argues that many customers will use the facility before buying the product through standard retail channels.
GECITS, 0044-171-599-5000 (GB), http://www.gecits.co.uk;
Computerland, 0044-171-638-5151 (GB), http://www.computerland.co.uk;
IBM, 0044-1344-343002 (GB), http://www.ibm.com;
Ideal Hardware, 0044-181-286-5146 (GB), http://www.ideal.co.uk;
Microsoft, 0044-870-601-0100 (GB), www.microsoft.com