A few Chinese brands are jostling some of the world's PC titans for the top spot in the mainland's fast-growing market. In the space of just a few years, domestic hardware companies have emerged as the momentum driving the nascent PC market in the mainland. The early 1990s were not kind domestic PC manufacturers. The market's remarkable growth was spurred by foreign entrants. In the past, China's largest distributors would have an alliance with only one vendor and firms such as Compaq and AST were able to grab their top market ranks because they had a monopoly. Now, distributors are selling multiple brands and, as a result, the market is more competitive. Local companies such as Legend Group, Tontru Group, Great Wall, Founder Electronics Group and Seastar are making names for themselves. To do this, some of these companies used the least likely of sources - the foreign vendors themselves. Great Wall manufactures PCs with IBM in a Shenzhen facility. Legend distributes PCs for Hewlett-Packard and AST Research. Founder distributes for Digital Equipment, and Seastar is one of Compaq's biggest distributors. The results from the joint ventures have been impressive for the local vendors. The changes in the mainland PC scene have prevented them from failing in the market. Beijing-based Legend Group reached the number one rank, edging IBM to second place during the fourth quarter of 1996. Since then, Legend has continued to exceed expectations as more than 80,000 unit shipments have been snapped up in the third quarter, equivalent to 11 per cent of total shipments, according to IDC Asia/Pacific statistics. Legend owes its success to competitive pricing. Last year, Legend worked with Taiwan's Acer Group to sell Acer Basic systems priced between US$800 and $1,000. Although the unit came without top-end processors and offered limited memory, the Acer Basic package attracted price-conscious consumers. Nearly 90 per cent of Legend's total PC shipments were under $1,500 in the past 12 months, IDC Asia/Pacific PC Pricing Program data showed. More than a third of those desktops fall in the sub-$1,000 band. The market continues to expand as PC prices keep falling. Local firms know their greatest weapon against foreign competition is lower prices. IDC estimates half of the computers bought in the mainland last year were non-branded clones. This represents a significant setback for United States PC manufacturers because they have been unable to succeed in the low-end price market. Leading multinational vendors are expected to launch several sub-$1,000 desktops designed specifically for the mainland early this year. Compaq's PC will house an Intel processor and a hard drive for the under-$1,000 category. But it will lack the multimedia and 3-D graphics features which are popular among Chinese users. Local versions offer more features. IDC believes that the majority of this market will prefer to stick with clones and local brands which still offer greater value at similar prices. International Data Corporation is a technology consultancy with offices in Hong Kong and Beijing. This year, IDC is planning a series of in-depth reports on PC-related issues in the mainland.