NEW YORK: Apple Computer Inc. has cut prices on its high-end Power Mac line of desktop computers and flat-panel display monitors, in what company founder and Chief Executive Steve Jobs has called "the year of the notebook."

Competition is fierce in the PC market, with demand soft for more than two years and Dell Computer Corp. waging a price war that has pushed most competitors into the red.

Competition in the PC monitor market has also heated up. Gateway Inc. has introduced a 42-inch plasma digital television and monitor that costs $2,999. Other companies, such as private eMachines, sell inexpensive flat-panel displays.

"What we wanted to do is make the economics of the entire Power Mac system ... approachable to more customers," said Greg Joswiak, vice president of hardware product marketing at Apple.

Apple cut the price of the 1 gigahertz Power Mac G4, which runs at a speed of 1 billion cycles per second, to $1,499 from $1,699. That's the lowest price it has offered in the Power Mac line since the late 1990s, said Tom Boger, director of Power Mac product marketing.

It also lowered its price on the 1.25 gigahertz Power Mac G4 to $1,999 from $2,499, he said.

The lower prices still put the Apple machines at the high end of the curve in terms of PC prices industry-wide but are an improvement in terms of price and performance.

"In the past, they've charged a premium for the specialized environment and they have been working on trying to get more aggressive," IDC analyst Roger Kay said.

Apple introduced a 20-inch cinema display model that starts at a price of $1,299 to replace its 22-inch model, and cut the price on its 23-inch screen by 43 percent to $1,999 from $3,499. It also cut the price of its 17-inch Studio model to $699 from $999.

© Reuters