Laptops: The Little Guys Keep Gaining

Today's laptops are packing more power and features than ever--for less

This year, nearly 13 million people--traveling sales reps, executives, and small-business people--will get a new laptop computer. In the past, most of those buyers could count on one hand the brands they were likely to consider: Toshiba, Compaq, IBM, or Apple. Together, these "big four" had a near-stranglehold over two-thirds of the portable PC business.

Not anymore. New suppliers are rushing in and winning converts with some dazzlingly low prices on amply configured portables. Attracted by the market's rapid growth, steady profits, and high visibility, newcomers such as Acer America, Dell, Samsung, Texas Instruments, and, most recently, Fujitsu and Hitachi are upending longstanding relationships among notebook buyers and their suppliers. In the process, they are redefining the notebook as an everyday computer--not just the expensive accoutrement of a road warrior.

Market leaders are fighting back, shoving technologies that a year ago were found only on machines costing $6,000 to $8,000 into machines priced at less than $4,000. IBM, for example, is shifting its focus from pricey, high-performance models to those that appeal to a wider audience. Its newest multimedia ThinkPad 365, released on Oct. 15, lists for $3,500 yet sports such top-shelf features as a 12-inch color display and an infrared link that lets the notebook send files to another PC or to a printer.

The top suppliers are defending their markets by adding more business-oriented laptops and, at the same time, reaching out to new buyers. There are machines for everyone from students to executives. Toshiba, the volume leader, has 15 new models, from ultralights for road warriors to models aimed at small-business and home-office buyers. Those home-office machines are being sold at electronics chains such as Best Buy.

Apple Computer, which dropped out of the market last May after its PowerBook 5300s hit huge quality snags, is coming back. The 1400C, introduced in October, has a 117 Mhz PowerPC chip and an 11.3-in active-matrix screen. Mac lovers, however, may have to wait until January to see a plentiful supply.

Canon USA, barely present in laptops a year ago, is taking an aggressive tack on price with its InnovaBook line. The 490 CDT, with a 133 Mhz Pentium chip, six-speed CD-ROM, 1.0-gigabyte disk drive, and 11.3-inch active-matrix screen, sells for just $3,000--a third less than similar machines from big-name suppliers. And as a fall promotion, Canon is throwing in a little extra with every 490 CDT laptop: a leaf-blower.

BIG OPENING. Another factor shaking up the market--to the benefit of consumers--is a shortage of inventory from some traditional suppliers. Large corporations, until now the biggest market for laptops, are in the process of upgrading their mobile-computer fleets from machines based on Intel's 486 chips to Pentium models. That has left the top suppliers--Toshiba, Compaq, and IBM--straining to keep up with demand. And it has created a yawning opening that companies such as Canon, Sharp, and Hewlett-Packard are aiming to fill.

With so many new choices, what should you look for? The single biggest consideration remains the display. Choices center on size and technology. Last year, the most common displays were 10 inches. But these are rapidly giving way to 11-in. and 12-in. LCDs in mid- and high-priced models. The main screen technology categories are passive matrix, also called DSTN, and active matrix, also called TFT. The latter is brighter and has richer colors--and commands a richer price.

Midpriced laptops, costing about $3,000, come with 11.3- to 11.8-inch passive-matrix displays. The most expensive laptops, costing $5,000 to $8,000, have larger, 12-in.-plus active-matrix screens. One advantage of choosing a larger display is that these portables can double as office machines without the need for an external monitor. With a 12-in. screen, built-in sound, and 1.3-GB drive, Compaq's highly rated LTE 5300, for instance, is just as versatile as any desktop. It commands top dollar, too: a steep $6,398 as tested (chart).

LESS STRAIN. Active-matrix screens are more easily viewed in strong light and work well for customer presentations. Another advantage: TFT screens cause less eyestrain than passive-matrix models when used for extended periods. While TFTs are still more costly than DSTNs, the premium for TFT is narrowing. On the AST Ascentia J, an active-matrix display adds just $300 to the price.

But the screen isn't the only consideration. Pay attention to the pointing device. How easy or difficult it is to work these pseudo-mice will determine how user-friendly your laptop will be. Many makers, such as Packard Bell, NEC, and Canon, have adopted touchpad cursor controls--especially for top-of-the-line machines. A better choice for heavy text--editing or spreadsheet work--may be the eraser-like pointer found on the Compaq LTE 5000, IBM, and Toshiba laptops--or the optical trackball in Dell Computer's Latitude XPi notebooks. Both technologies provide more precise control.

Another thing to keep in mind: The quality of pointers varies. Make sure you're comfortable with the version provided. One of the nice touches in Compaq's new Armada 4100 series and the WinBook Computer's Winbook FX is you can choose a touchpad or a trackball.

Here's a welcome innovation: Dell and Texas Instruments now use the same batteries across generations of notebooks. The idea is to share the cost of add-ons or extra parts by guaranteeing that those bought today can be used on future models. "Stability is key," says Dell Vice-President Jon Sedmak. "Corporate customers are looking for continuity." Dell also uses the same docking station for all models. Sedmak says half of notebook customers now purchase a docking station, a device that helps a laptop work in the office as well as on the road. The computer snaps into the unit, which has all the connections for a local-area network, printer port, and so on.

For the best performance, get a docking station with the speedy PCI "bus" used in most desktops. Also, consider this: If you choose a laptop, with a large screen and plenty of disk storage, the only thing you need is an inexpensive "port replicator" with an ethernet card to link your laptop to the company network.

Since its return to laptops in 1994, Dell has been aggressive on price. It offers 12-in. active-matrix screens and 133-Mhz Pentium chips in its lower-priced Latitude LM line, which includes a $3,000 multimedia notebook. Low price and advanced features helped make Dell's Latitude LM P133ST the top-ranked machine in tests by the NSTL/McGraw-Hill.

Texas Instruments' surge to No.3 in portables reflects another change. In a market where unit sales are expected to grow 25% this year, having multiple, broad product lines is important. TI has greatly expanded its Extensa line. These machines, tailored to small- and midsize businesses, include the Extensa 570 CDT, which uses the older 100-Mhz Pentium chip but was ranked as highly as some 133-Mhz machines by NSTL.

The market is also demanding designs that accommodate upgrades, the way desktops do. Most laptops now have a modular "bay" design that can take a floppy drive, CD drive, or extra battery. An aftermarket is emerging to fill those bays. Think your PC maker charges too much for a spare battery? Consider companies such as Port in Norwalk, Conn., which sells notebook batteries for about 20% less than the manufacturers charge. Battery replacements for the ThinkPad cost $110, vs. $130 for the IBM product in stores. Can't afford a new multimedia machine? Panasonic sells an add-on quad-speed CD-ROM drive for $350.

With the proliferating competition in notebooks, expect to see a lot of new labels staring up from those airline-seat trays. It hasn't reached gasoline-war proportions--with free glasses with every fill-up. But a leaf-blower ain't bad.

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