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Big Blue dumps EU

IBM to drop direct PC sales in four EU countries

IBM is phasing out direct phone sales of PCs in the UK, France, Germany and Sweden, although customers in those countries will still be able to order machines online.

The company has been focusing on telephone sales to smaller firms, but has found that those customers prefer to deal with local vendors, said Ian Colley, a spokesman for IBM.

"It's really just a reflection of how our customers want to do business," he said. "Small and medium businesses buy technology in the form of a solution that addresses their problem. In a local marketplace that most often takes place in conjunction with a business partner."

The move comes as part of IBM's general shift away from PC retailing, said analyst Brian Gammage of Gartner.

"IBM traditionally has probably the least efficient supply chain of all the major PC vendors, so especially in the environment of the past year, where Dell has used its network to maintain pressure, IBM has suffered," he said.

Unlike manufacturers whose sole business is PCs, however, IBM can afford to focus on the sectors of the market that it finds more lucrative, he said. "They've really been cherry-picking the business they want to do."

IBM has also been moving to outsource PC production, announcing on Wednesday a three-year, nearly £3.5bn deal to transfer most of its NetVista desktop PC manufacturing operations to California-based Sanmina-SCI.

According to Gartner, IBM's PC sales in Europe, the Middle East and Africa were down some 30 percent since 2000 while the market as a whole shrank only 5.3 percent.

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