Is Google Crazy for Selling a Desktop PC at $350? Definitely Not
NEW YORK (TheStreet) -- The purpose of this article is to talk about the impact of Google's (GOOGL) new radically cheap desktop PC on the competition from Microsoft (MSFT) and Apple (AAPL). This product has just become available, and the impact could be huge in the desktop PC segment.
Do you remember approximately one decade ag, when a 50-inch television used to cost $5,000? Yes, me too. Then somewhere along the way came Vizio and the TV aisle at Costco (COST) changed forever. Now that 50-inch TV is better, and it costs one decimal point less, $500.
Desktop PCs have not seen the same price reductions. Obviously the PCs keep getting better every year, but the price has not fallen much. People have tended to pay approximately the same for a desktop PC today, as they did many years ago already.
Here are the examples today:Going to the Apple store, the cheapest iMac today is $1,300 (22 inches). Going to the Microsoft store (www.microsoftstore.com), the cheapest all-in-one desktop PCs are two models from Samsung (SSNLF) and Sony (SNE) for $900 each (also 22 inches). Those prices are in the same ballpark where people paid for desktop PCs a decade ago, even though most of them at the time were more often a tower plus a separate monitor. Now, however, Google and two of its hardware partners have decided to throw two very nasty stink-bombs into the desktop PC market: 1. LG Chromebase: This all-in-one 22-inch PC comes with all the trimmings: keyboard, mouse, etc. It's got WiFi built-in, as all-in-ones usually do. You can even use it as a monitor for another PC, including a laptop. The price: $350. Amazon (AMZN) started taking orders a few days ago at $330, but it stopped the other day because apparently it sold out -- for the moment.