SAN FRANCISCO – Dell's efforts to turn around its consumer PC business will translate into added competition in the retail channel and put pressure on HP's, Deutsche Bank Equity Research said in a research note today. 
 
During the past four to six quarters, HP has consolidated significant share in consumer PCs as it benefited from international growth, better retail distribution, a solid product line, and Dell's exit from the low end, says DB. 
 
After several quarters of weak consumer PC unit growth, Dell is now aggressively pursuing the indirect consumer channel with a reinvigorated consumer PC line.
 
DB’s price comparison analysis shows that similarly configured HP and Dell consumer PCs are priced comparably at retail outlets. As such, the combination of improved product design, competitive pricing and its retail distribution initiative should support improving growth in Dell's consumer business during the next several quarters, according to DB. 
 
Although revenue realized from the consumer retail strategy will likely dilute corporate margins, the incremental profit opportunity for Dell is significant and largely incremental to DB’s existing EPS estimates.