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Recession. What recession?
Saturday, November 08, 2008

There is such a thing as recession proof industries.

Wikipedia lists the entertainment and weapons industries among them: whether the economy is good or bad, we need to be entertained and someone needs to be shot at (this says a lot about or society, if you think about it).

Computer hardware is not recession proof for various reasons. Though some manufactures want to prove us wrong, if current computer prices for top of the line machines are any indication: Lenovo1 and Apple still sell ridiculously over-priced hardware.

I know that cost and price are relative and that value is not only about money, but I have a hard time looking at a $6,000 laptop and thinking to myself, "Hey, that's a reasonable price for my computing needs."

It's no secret I like ThinkPad notebooks: I own 3 of them, and will likely continue buying one every 2 years. Nevertheless, paying $6,000 for a laptop today is extreme, to say the least.

The target demographic for this laptop--the ThinkPad X301--seems to be "the mobile executive" who needs to have a light computing companion to read emails, surf the web, and dazzle investors with great presentations, but can't be seen with a pedestrian laptop. You see my point, though. Is the laptop really worth this much?

The answer to this question smashes onto the never ending wall of reason. On one side you have exquisite and expensive items; on the other you have utilitarian yet affordable products. The winning argument for luxury is simple to state: if you can afford it, why not? The winning argument for cheap is also simple to state: why pay more, when I can get the same function? Both arguments have their defenders, and you will make either of them, depending on the circumstances.

I want to point out that I'm making the price of the X301 to be so exuberantly high because of similar offerings in the market that costs less. But the price isn't really that high, when you put it in context and the cost gets lost in quarterly balance sheets as part of the "depreciating assets" umbrella--then the price doesn't seem that bad. There are far worst things on what executives can spend shareholders money. What's more, portraying a winning image is part of the job--just ask Sarah Palin ($6,000 for a computer is nothing compared to $150,000+ worth of shirts and pants). Just imagine the power executive in the next meeting: laying that marvelous X301 on the boardroom's table speaks volumes. It screams, "Trust me with your money!"

Let me state that I'm not bashing over-priced laptops. Specially, a Thinkpad. The X301 is a very well engineered machine, and it's thin as thin can be. I really like this laptop; however, it is grossly underpowered under the hood, with a low voltage CPU running at 1.4 GHz. This machine is all about portability and long battery life, because it assumes its target market is always on the go. Lugging a 5 lb laptop around O'hare is no laughing matter, but there are "cheaper" computers that weight less and have more computing power...but they are no X301s and don't look as good.

There is no questioning the fact that our workforce needs to remain productive everywhere, 24/7. We are a connected service oriented society and we depend in our connectivity to create value. Though, fiscally responsible shareholders will be looking at these expenses a bit more carefully. Unless, of course, you sell movies or guns or both, then there is no point of skimping on pennies here and there for cheaper, ungodly looking hardware. For these markets, things keep looking better and better, regardless of what economist say. Recession? What recession? Exactly...

1. I priced this machine this morning. I considered for a long time buying one of them, because I like thin laptops. The entry model is around $3,000, but the computer I quoted on Lenovo's site included the best combination of components money can buy. I didn't include anything I wouldn't use on a business trip (a 21" LCD); everything in my spec is about a single machine I can put in my laptop bag and just go. The spec included the biggest hard drive available, the most RAM I could put on it, the best warranty service I could get, the most bloated MS Office Lenovo offers, etc., etc. The price surprised me: $6,300 + 13% TAX. Yes, that's over $7,000.

11:35 AM | 2 comment(s) |


I configured the X301 with everything, including the max software configuration and I couldn't get it to go much over $4k USD.

What currency are you talking about? And.., honestly, do you *need* SSD based drives? :/

For the record, the new Aluminum MacBook (non-Pro) is a great deal!
By Anonymous Anonymous, at 1:13 AM

I configured the laptop on the Canadian site. You'd think that with our money value being so close, US and CAD sellers would charge the same for the same items. Not so.

I rarely buy anything from the Canadian site, as I can get better deals in the US. The price difference is similar to book prices: we Canadian pay a premium. It has always bothered me and will continue to do so.

I repeat it here: the price I got for this computer includes everything I would need to travel. For example, I put in my cart a leather bag, a lock, MS Office 2007, a port replicator, etc. I have to admit that a leather bag is not necessary, but nothing it too good for a mobile executive (even for the imaginary I was shopping for).

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