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AnchorDesk

David Coursey
New Pocket PCs: Don't let Dell make you look stupid

David Coursey
Executive Editor, AnchorDesk
Wednesday, November 20, 2002
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Thanks to Michael Dell, I think I know how much I'll pay for my next HP iPaq. If it's true--as his company claims--that the new Axim X5 is comparable to an iPaq 3900-series PDA, $299 may now be the price point for a high-end PDA.

I SAY "MAY" because it's not clear that Dell's introductory pricing for its new Axim handhelds--$199 for one model, $299 for the other, both after $50 mail-in rebates--will last. It's possible that Dell will let Axim prices creep upwards over time, especially if HP doesn't react to Dell by lowering prices on its iPaqs.

Early reviewer comments favorably compare the $199 Dell to the new HP iPaq 1910, which sells for $299. But it's at the high end where HP might have to really dump prices to match Dell. True, the Dell devices don't have any communications features, such Bluetooth, cellular, or 802.11b. But those should add only $100 to the price tag, anyway. Even at $399, the high-end Axim would be nicely discounted from the $599 or $699 you'd pay for similar devices today.

Also, remember that Dell is still a more credible brand to corporate customers than HP or Compaq. And while today's iPaqs sport the widest variety of third-party add-ons, that will change if Dell starts selling in volume.

I got to play with an Axim at Comdex. (Check out the video here.) It's a very nice device, with a bright color display, decent button placement, and dual slots for either CompactFlash or Secure Digital memory. It also has something I've never seen on a Pocket PC before: a removable, rechargeable battery. (That will make my colleague David Berlind happy; he's been agitating for removable batteries just like this.)


  Dell's Brian Pitstick unveils the Axim X5, the company's first foray into the handheld market.

Watch now
Bottom line: I like the new Axims, and the prices are certainly right. If I'd had a chance to play with them prior to writing my holiday gift guide, they'd have definitely made the cut.

BUT THERE'S ONE THING I definitely don't like about the Axims. It has nothing to do with the devices themselves, but, rather, with how they're being sold.

I can't let the words "Dell" and "mail-in rebate" pass without comment. If I were king, I'd declare such rebates illegal, as deceptive marketing, for reasons I'll explain in a moment.

The closest I've come to a rebate system I like is at Costco, the chain of warehouse stores. When I buy something at Costco and there is a rebate attached, the cash register automatically prints out a rebate form. I carry stamped envelopes in the car and immediately mail the form, which means I never miss a rebate. Costco makes it fairly easy for me to get the money that's owed me.

Dell, meanwhile, is perfectly happy to take your money over the Internet, but demands you mail in a form and the packing slip to receive your $50. Since Dell is the manufacturer, it's not like someone else is paying the money to the consumer and needs proof of your purchase. So what gives?

If Dell wants to give me a $50 dollar rebate, why doesn't it just reduce the cost of the product by $50 and call it an "instant rebate" or even a "limited-time instant rebate"? After all, it should be less expensive for Dell to reduce the price during the online transaction than it is to process all the mailed-in paperwork and cut the checks.

But, of course, it isn't cheaper because Michael Dell knows something: People are stupid or forgetful or some combination thereof. Mr. Dell understands that some apparently significant number of customers won't ever get around to mailing in the form and the packing slip and he'll get to keep their $50. This must save him enough money to make handling the paperwork and cutting the checks to those who do remember worthwhile.

I THINK this is slimy marketing. It lures customers with a low price that--as Dell well knows--many of them will never actually receive.

While Dell certainly isn't the only company to do this, I wish it'd reconsider marketing programs that essentially tell customers, "Hi, I'm Michael Dell and I'm willing to bet $50 that you're too stupid to mail in a rebate coupon!"

So, if you buy an Axim (which, as I said, would make a great holiday gift), why don't you make sure Michael loses that bet while you're at it. OK?

What do you think? Would you buy a $199 Pocket PC? Do you think it's fair to advertise a price when you have to mail in a rebate form to get it? Take my Quickpoll below and TalkBack to me! 

Is it fair of Dell to make low prices on its new Axim X5 Pocket PCs dependent on whether or not you mail in a rebate form?
Sure it's fair--it's not that  hard to mail in the form!
No, it's not fair--they should give you an instant rebate or just make the price lower to start with.

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