It may run into some sales resistance from customers who reckon the costs of producing the disks can’t have risen that much and it’s asking them to fund future development, but Lotus Development Corp is to raise wholesale prices of its software in mid-January. Lotus is justifying the move by saying that most of the extra money it hopes to take in will be spent on giving rebates to dealers according to how much customer support they provide, rather than on the volume of Lotus software they sell, as at present. The increase is expected to put at least $20 onto the street price of 1-2-3, which lists at $495 but typically sells at $275 or so. Wall Street is looking for the announcement to lead to a surge in fourth quarter figures for Lotus as dealers stock up ahead of the price increase – but by the same token, a slump in the first quarter of 1989 seems likely to follow the measure. Meantime Borland International and Microsoft Corp, eating into 1-2-3’s market share with Quattro and Excel respectively, confidently expect to win more share at Lotus’ expense.
