Dell facing tough times

As if a global recall of notebook batteries was not enough, Dell, the world's largest computer maker, is potentially facing a series of lawsuits in China following accusations of false publicity. All of this comes as another senior executive in the company's Asia operations has left the company after just one year in the post.

A Shanghai court has been reviewing allegations made by 19 Chinese customers who say that Dell equipped their PCs with chips inferior to those named in their publicity materials. Dell allegedly fitted the computers with Intel T2300E chips instead of the more powerful T2300E. According to the claimants, who are demanding double their money back plus legal costs, the T2300 can perform several functions that the T2300E cannot, including some software upgrades. Dell has put the error down to a simple mistake made when it changed the chip specification on some computers before the relevant publicity materials were ready and has now offered to refund the disgruntled customers. Although the case was brought by just 19 people, it is likely that the successful claim will open the doors to wave of similar cases being brought.

Meanwhile Dell's China president, David Miller, has left the company less than a year after taking up the post. He is to be replaced by two co-presidents, Liu Junling and Amit Midha. The move comes after a series of high profile departures at the company's China operation. Former China president, Foo Piau Phang, retired last autumn, making way for Miller and then in December 2005 the company's Asia Pacific head, Bill J. Amelio, left to become CEO at rival Chinese PC maker Lenovo following its acquisition of IBM's PC division.

CMI - 22/8/06