You have $1,500 burning a hole in your pocket. Back in the early 1980s, it would have bought you half of a PC. Today, that money will buy you two or even three systems--sometimes with monitors. This is great news for small businesses and for consumers on a tight budget. But do these systems deliver?

To find out, I got hold of Compaq's Presario 2266, which, while not priced at that magic $499, comes pretty close. I've also compiled a table of PCs in the sub-$800 category, listing the features you can expect from computers priced in this range.

The Incredible Shrinking Price Tag

Why are prices dropping so fast? It's been only six months since everyone started crowing about the joys of sub-$1,000 systems. The ever-dwindling price of PCs is a function of two things: Moore's Law and the law of supply and demand. Gordon Moore, one of the founders of Intel, stated that the capability of chips would double every 18 months or so, a prediction that has been borne out in the last 30 years. When you factor in the demand for fast CPUs in the 400MHz-and-faster range, you have a glut of last year's processors (mostly 300MHz and slower) kicking around, all available to PC makers at fire sale prices.

These chips--from Intel, AMD, Cyrix, and IDT (which makes the WinChip)--are all perfectly serviceable. Unless you're into demanding computer tasks such as speech recognition, processors running between 266MHz and 300MHz are fast enough.

Super-cheap PCs like eMachines' 266MHz eTower, IBM's 266MHz Aptivas, and Compaq's 300MHz Presario 2266 are geared toward light home use (that is, not for games). They're more than adequate for the bulk of small office work (word processing, spreadsheet, communications, and light database use) and they all cost between $500 and $800.

Naturally, not all savings are due to cheaper processors. Many of the cheapest systems skimp on other components. They may use generic, 24x CD-ROM drives instead of 32x drives, and they may rely on built-in "Winmodem" chipsets that delegate a lot of tasks to the CPU. Many of these cheap PCs are built around the Cyrix M II processor, which also shoulders video display tasks, using 4MB of your regular RAM in the process. This is especially problematic with 32MB M II systems, which leave you with only 28MB of usable RAM, not enough for some demanding office software.

Two other areas where vendors shave expenses are onboard cache and expansion options. The original Intel Celeron chips, for example, couldn't handle any secondary (L2) caching. Some of these older chips are still being used, so ask before you buy a Celeron-based PC. Newer Celerons can use L2, but to save money, some PC makers don't install the cache. Skimping on L2 cache seriously impedes your PC's performance; 512K is ideal, but every little bit helps. Even a 128K cache should yield better performance than a system lacking L2 cache.

Chances are that someday you'll also want to add hardware to your PC. Unfortunately, some cheap systems skimp on drive bays and expansion slots, so ask the vendor and look before you buy. If the PC comes up short, check for USB ports. Fast becoming a standard feature, two USB ports should accommodate most of your needs for external storage, input devices, and even network connections. (For more, see "USB: Easy as Child's Play?" at www.currents.net/covr.)

Compaq's Penny-Pinching Presario

Computer Currents has already looked at the cheapest alternative in the sub-$800 category--the $499 eMachines eTower--and found it serviceable for general office work (see www.currents.net/magazine/national/1622/prev1622.html). At the top end of this bargain spectrum is the $699 Compaq Presario 2266. With a comparable 14-inch monitor (the system doesn't include one), it costs about $350 more than the eTower, but you get a bit more for the money.

Like the eTower, the Presario 2266 is built around a Cyrix CPU, comes with a V.90 Winmodem, and includes a Windows 98 and Microsoft Works bundle. However, the Presario features the faster 300MHz M II (versus the eTower's 266MHz), and has more storage and memory: a 4GB hard drive and 64MB of RAM (4MB of which are dedicated to video processing). The Presario 2266 doesn't come in a clunky minitower case, but rather a sleek desktop box that's 4 inches tall, 14 inches wide, and 15 inches deep. You also get some handy conveniences. For example, the front of the Presario has a sleep button that puts the system into a low power mode without requiring you to shut down Windows, which is handy if you're heading off to lunch or to a meeting. The Presario keyboard also includes a sleep button, plus a dozen other special-function keys. Above the numeric keypad are four Internet keys that instantly launch e-mail software, a Web browser, a search page (AltaVista by default), and an e-commerce page (a Compaq-branded Junglee Web mall by default). You can program these easy-access buttons with an applet hiding in Windows' system tray. There are also volume and mute buttons on the keyboard, a programmable key for launching a favorite program, and audio CD controls for those who use the CD-ROM drive for playing tunes.

Being a low-end desktop system, the Presario 2266 skimps a bit on expandability: It has one free 5.25-inch external bay and one free PCI slot. However, it has two USB ports that handled my test devices without a hitch. Even a troublesome USB keyboard, which required a CMOS Setup change on some systems, was a painless installation on the Presario 2266.

Unfortunately, the Presario is a rather noisy machine. The Windows setting that mutes the modem didn't work and the hard drive noticeably whirs, though you wouldn't notice if the PC was un derneath your desk. I also had connection problems using the Presario's V.90 modem. I got connections be tween 32Kbps and 40Kbps on lines that usually yield 42Kbps to 44Kbps. Both the Presario and my control PC use Rock well's HCF modem chipset, so there was clearly a shortcoming with Com paq's drivers.

This problem gave me a chance to check the Presario's abundant tech support. After some slow and fruitless trolling for driver updates on the company's Web site, I tried Compaq's toll-free (a rare luxury these days) tech support line, which is open seven days a week, 24 hours a day (even more rare) during the one-year warranty period. Service was fast, but it took a couple of calls to discover that the driver update will be part of a SoftPaq service release due later this year.

Like many companies, Compaq keeps costs down by cutting deals with various Internet vendors. You get a $100 rebate on the system for trying Compaq Easy Internet Access, a version of GTE's Inter net service. Compaq also cut deals with Yahoo, AltaVista, and Junglee (hence the preprogrammed keyboard). I wasn't overly impressed by the $19.95 per month Internet access service (there were no local numbers in my neck of the woods), but the rebate holds good even if you cancel before the 50-hour, 30-day trial is up.

All told, the Presario 2266 isn't a bad system. It's a fair performer with some nice features that you're unlikely to find elsewhere for the price. You'll have to budget extra dough for a monitor, and the software bundle (Windows 98, Quicken 98, Microsoft Works, Ring Central communications, and typical Internet access software) is a little rudimentary. It's hard to criticize an $800 system too harshly unless you've only got $500 to spare. In that case, the eMachines eTower looks pretty attractive.

© 1998 Matt Lake. All rights reserved.

Matt Lake has racked up experience in three major corporations and one branch of the government. He currently maintains a small business from his offices in Philadelphia. You can reach him at mattlake@cis.compuserve.com.

Where to Buy

Presario 2266
Compaq
800/888-5858
www.compaq.com/athome
Street price: $799;$699 after rebate

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