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Dell Denies Plan to Exit LCD TV Business

By Ben Ames

June 07, 2007 — IDG News Service (Boston Bureau) — Dell will sell a wider variety of television sets made by other manufacturers over its website, but denied reports that it plans to stop making liquid crystal display (LCD) TVs.

A number of industry blogs reported Thursday that Dell would exit the LCD display market as soon as June, citing a story in the Taiwanese newspaper Economic Daily. That move would allow the company to focus on selling more profitable PCs, the report said.

On Thursday, Dell acknowledged that it is making changes to its TV line, but said it will continue to sell Dell-branded televisions with screens of 37 inches and smaller.

"We will soon offer a wider assortment of televisions from leading manufacturers that feature the latest technology and meet Dell's high standards for performance," said Dell spokeswoman Rachel Lyon.

The first step in that plan was Dell's move in February to add Sony LCD televisions with screens between 40 and 46 inches to the range of products sold on Dell.com, she said. Dell also sells TVs made by Matsushita Electric Industrial (Panasonic), Pioneer, Samsung Electronics and ViewSonic.

"Nothing has changed from what we communicated in February," Lyon said.

If Dell's television lineup remains constant, it will be one of the few parts of the company to avoid sweeping changes in coming months. Dell is in the midst of a corporate reorganization that includes laying off 10 percent of its 88,100 workers in an effort to rebound from sinking profit and market share, the company said when it reported quarterly earnings last Thursday.

The changes also include an overhaul of the company's core business model. On May 24, the company said it will soon begin selling desktop PCs in Wal-Mart retail stores, marking a departure from the "direct sales" approach it used to become the world's largest PC vendor until 2006. In recent quarters, Dell lost that title to rival Hewlett-Packard in a slump that pushed company founder Michael Dell to return to the job of chief executive after stepping aside to become chairman in 2004.

It will take time until those reforms can begin to stop Dell's losses. The company was the only one of the world's top five PC vendors to ship fewer computers in the first quarter of 2007 than in that same period in 2006, according to a report released Tuesday by iSuppli.

Dell held onto its second-place ranking behind HP even though its shipments dropped 6.8 percent. In comparison, HP shipped 26.5 percent more PCs during the first quarter than a year ago, and Acer showed a huge increase of 45.8 percent, allowing it to pass Lenovo Group and move into third place, iSuppli said.

 

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