Convex Computer Corp, as reported briefly (CI No 738) followed the announcement of its remarkably healthy-looking second quarter financial results with its first major price reductions on its C1 machines. The company, based in Richardson, Texas, says that the reason for price cutting despite its strong financial position is to retain its price-performance advantage over other supercomputer manufacturers. The company anticipates a price cutting war in supercomputers similar to what we are currently witnessing in the workstation market, and news has already reached its ears indicating that Alliant has made price cuts on its products, but Alliant will not be publishing them. A few weeks ago Cray Research announced its price cuts.According to Frank Vince, vice president of marketing for Convex, base system prices have been reduced by approximately 20% across-the-board and the cost for memory has been reduced by more than 50% from $4,000 to $1,750 per Megabyte. Previously, the smallest configured C1 XP1 sold for $475,000 and the C1 XL sold for $375,000. Now, under the new pricing structure, the base price of the C1 XP1, including the CPU, 16Mb of memory and the input/output processor, is $320,000 and the C1 XL sells for $240,000. Convex saw second quarter net profits up 142% at $2.2m after tax credits, and sales rose 84% at $16.7m. Convex anticipates continued growth throughout this year and next, and looks for a significant amount of this to come from Europe. Vince estimates that just under 50% of the company’s revenues comes from Europe with West Germany being one of the fastest-moving.
