years, according to local distributors MCS Ltd.

This reflected a worldwide improvement in the performance of Apple, which has just replaced rival IBM as the No. 1 seller of PC units.

IBM had held the top spot since it first entered the personal computer market in 1981.

Apple's move two years ago to slash unit prices and go for higher volume had been a tremendous success, said MCS vice president Mr. Robert Burns.

"Apple has really responded to the average person's needs and designed computers affordable to everyone,'' he said. "We have seen a dramatic drop in pricing to one-third of what it was two years ago.'' The extent to which Apple, in line with most computer manufacturers, has shifted emphasis from sales to service can be gleaned from MCS' employment statistics.

Two years ago, the company employed 16 people, most of whom were sales staff.

Today, the work force at the firm's offices in Victoria Street, Hamilton, has grown to 21 but it contains just three people in sales and marketing.

Sixteen staff provide support services, while a couple of people work in administration.

"We're certainly not the same company we were two years ago,'' said Mr.

Burns. "Our work force has changed from a traditional sales organisation with support services to a support organisation with a small sales force.'' He added: "Any company which doesn't respond quickly to market changes will not last for long. MCS has just tried to stay ahead of the changes.'' Although a three-fold increase in PC unit sales was obviously good, it also created a lot of extra work, said Mr. Burns.

"The sales figures sound great but it's not all roses for the dealers,'' he added.

As PC unit prices plummeted, dealers have seen their profit margins on eroded, he said.

"When a computer goes down in value so does its margin and its contribution to your business goes down,'' said Mr. Burns.

"Each machine is contributing a lot less than it was to the profit level of the company.

"We've had to become leaner and more efficient here in Bermuda in order to make money. It's a tough business.

"To be successful, MCS has had to become even more competitive with the US markets, as well as with rival IBM MS Dos machines and IBM clones.

"Our game plan in Bermuda is to make anyone thinking of buying a computer abroad to think twice.

"Once freight and duty is added we want our customers to say that it's not worth buying overseas.'' In order to boost sales, MCS gives a one-year warranty on labour and parts on all new PC units. If a unit under warranty breaks down, the company guarantees to fix it within 48 hours.

"We have to stock all the parts on the Island to meet that commitment,'' said Mr. Burns. "It's not easy but it's the level of service you have to offer these days.'' He called Apple's overtaking of IBM "quite a feat''.

"IBM had always been No. 1 but Apple has passed them in unit sales as well as sales volume in dollars,'' he said.

Despite Apple's new position as the leading PC seller worldwide, IBM was still the top selling make in Bermuda, according to Mr. Walter Ingham, general manager of IBM's local distributor, Bermuda Computer Services.

IBM had suffered in the past due to the plethora of IBM clones that have swept the international PC market trying to cash in on IBM's success, said Mr.

Ingham.

"Apple has not suffered in this respect,'' he said. "There are very few, if any, rival Apple-compatible PCs on the market.

"I don't think Apple's greatly increased its overall market share, if you take into account IBM and IBM-compatible products.'' IBM reacted to growing competition by announcing in October that it was slashing the prices of its PCs, some by as much as 50 percent, said Mr.

Ingham.

"We're already seeing the reaction to the drop in prices,'' said Mr. Ingham.

"It's a price war out there but I'm confident these new measures will result in IBM once again becoming the top seller.''