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By Dominic Maher, 6 May 1999 16:20

NEWS PC manufacturers, Siemens and Fujitsu, are reportedly in talks this week over a possible joint venture to sell their products together. If a tie-up goes ahead the combined market share would make them the second largest PC supplier in Europe. Neither company has commented on the rumours. Clive Longbottom, strategy analyst at Strategy Partner International, said increasing numbers of smaller companies are looking at joint agreements. "By joining forces and creating more of a presence in the corporate market, this is the only way they can compete," he said. Also published this week is Dataquest's quarterly survey of European PC sales. Figures show that for the first quarter of this year direct vendor Dell nudged ahead of IBM to take the number two spot - with sales up 43 per cent. Compaq, despite bad results in the US and the loss of their CEO, has retained the number one position with a 16 per cent market share. But Longbottom warned: "Dell could trip up in the next couple of quarters." He explained that they face more problems from the Year 2000 issue than most. "At the moment businesses are replacing machines to help get through to the millennium and this is where they [Dell] are doing well. If they can weather the storm and the slowdown in growth they then may be able to go for the number one spot but it will take a hell of a lot of effort to dislodge Compaq," he said. The Dataquest survey shows over all European sales up by 20 per cent with a 61 per cent rise in Western Europe.