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Consolidation by death

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Dell Computer has left no one in doubt that there's a price war going on - and that it means business. On Wednesday, the company took an axe to list prices for desktop PCs, storage boxes and server.

It says it can cut prices quicker than rivals because it sits on less inventory and so price cuts from component makers feed through its business that much earlier.

The company may win few fans in Wall Street for sacrificing margins, but there is little doubt that this is the time to be aggressive - for those who can afford it.

Michael Dell, chairman and CEO, said: "You have not seen the last of our price-cutting. It's only a price war if you are losing money and you are losing market share. We are gaining market share and increasing revenue," the FT reports. ®

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