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Focuses on Hewlett-Packard's introduction of a low-cost computer in China.

Reports on a potential partnership between I.B.M. and the Chinese firm Lenovo. Comments from I.B.M. CEO Samuel J. Palmisano on the partnership; Impact of the partnership on China's high technology industry; Debate at I.B.M. over the future of their personal computer business; Details of the development of a partnership between I.B.M. and Lenovo.

Examines the significance of I.B.M.'s decision to sell its personal computer business to Lenovo, China's largest personal computer maker. Suggestion that the deal reflects the industrial and economic ambitions of the two companies and also their two nations; Overview of the complex transaction; How the I.B.M. personal computer business will be run under Lenovo's ownership; The rising global aspirations of corporate China as it strives to become a trusted supplier to Western companies and consumers; Outlook for I.B.M.'s future in technology services and consulting, in software and in the larger computers that power corporate networks and the Internet; How U.S. companies are scrambling to take advantage of the vast potential of the Chinese market.

Discusses how I.B.M. is in serious talks to sell its PC business to Lenovo, the largest maker of PC's in China. Consideration of how executives at companies such as Hewlett-Packard and Dell Computer were pleased with the news that I.B.M. may soon be absent from the PC market; How the sale to Lenovo would create a strong new rival with operations based in China; Reference to how Lenovo has the potential to decrease the prices of PCs due to its trend as a producer of low-cost machines; Forecasting on how Lenovo will be more aggressive on pricing leading to a compression on price points in the industry.

Discusses the efforts of the Chinese PC maker Lenovo Group to buy I.B.M.'s personal computer business. Consideration of how the Lenovo Group had sales of over $3 billion in 2003 and its ranked eighth among PC makers; Suggestion that the company makes its largest sales to Chinese government agencies and schools; Reference to how Lenovo is immune from tariffs levied against brands such as Dell, Hewlett-Packard, and I.B.M.; How company stock decreased when Lenovo reported poor earnings; Hopes that the merger would relieve some of the competitive pressure; Efforts of Lenovo to make itself more marketable by designing its own personal computers.