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Toshiba Notebooks’ Glory Days Are Over

An audible yawn from VARs and integrators was about all Toshiba could muster last week after announcing it is selling a line of sub-$1,000 notebooks through the channel. If the vendor, once the channel’s notebook king, expected VARs and integrators to trip over themselves to get their hands on the machines, it must have been […]

Written By: Pedro Pereira

Dec 13, 2005

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An audible yawn from VARs and integrators was about all Toshiba could muster last week after announcing it is selling a line of sub-$1,000 notebooks through the channel.

If the vendor, once the channel’s notebook king, expected VARs and integrators to trip over themselves to get their hands on the machines, it must have been as disappointed as a rock band trying to relive its glory days through a comeback.

Indifference is about the most disdainful reaction one can have to anything. It’s tougher to conquer than the anger and hatred I suspect Apple would have to overcome if it ever decided to reverse its shabby treatment of partners.

But when taking into account Toshiba’s history in the IT channel, the reaction should come as anything but a surprise.

A decade or so ago Toshiba notebooks were all the rage and it seemed everybody wanted one. But that has changed.

Now that notebooks have become so popular, to the point of replacing desktops as the primary workstation for many office users, Toshiba hardly makes a ripple. And its decision to push Tecra L2 laptops priced at less than $1,000 exclusively through the channel is not about to create a wave either.

Click here to read more about Toshiba’s new channel push.

The problem is that the brand, despite representing solid, often-innovative technology, no longer has credibility with the channel. Toshiba lost its focus in the late 1990s as it sought to build on the popularity of its notebooks by venturing into desktops and servers.

And the vendor could hardly be blamed for trying to expand its product line. After all, plenty of channel companies, pleased with the notebooks, clamored for a full product line from the brand.

It is common for channel companies to standardize on one or two brands, even though many carry various product lines, because it is easier to support a limited brand offering.

But unfortunately Toshiba couldn’t pull it all together. Its desktops and servers hardly made a fraction of the impact that its notebooks had achieved.

The company never allocated enough resources to developing a solid support infrastructure for channel partners. Its technical support was notoriously inadequate and even became the subject of ridicule on an episode of The Tonight Show with Jay Leno.

And there were lawsuits. In one case, the company agreed in 1999 to a $2.1 billion settlement for selling allegedly defective notebooks.

The company also caught Dell fever and launched an online store through which customers could buy direct. The vendor has given preference to the store, www.toshibadirect.com, over channel partners, and that is another reason for the channel to dismiss Toshiba as a viable partner.

In light of the channel conflict and with the availability of reliable alternatives such as IBM/Lenovo ThinkPads and Acer notebooks, why would a VAR or integrator do business with Toshiba at his stage?

Michael Schwab, vice president of purchasing at distributor D&H Distributing Co., for one, says his VAR and integrator customers are happy with the Acer notebooks D&H sells them. Since D&H stopped carrying Toshiba about 18 months ago, he said, resellers “are not calling and asking for Toshiba.”

David Hudgins, president of PC Products & Services, a VAR in Greensboro, N.C., said offering sub-$1,000 notebooks to channel companies carries little value. “The channel is there to add value. How much value-add can we lay on top of a sub-$1,000 notebook?”

Hudgins doesn’t expect to carry Toshiba any time soon.

Of course that doesn’t mean Toshiba will have zero penetration in the channel with the sub-$1,000 notebooks, which surely will find a home with select VARs under pressure from price-conscious customers.

But the glory days of Toshiba notebooks are over. And that is not about to change.

Toshiba Notebooks’ Glory Days Are Over

Pedro Pereira

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