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Technology Stocks : Ampex Corp: Digital Storage

AMPX 12.44

-8.4%

Jan 30 9:30 AM EST

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To: jonggua who wrote (1139)	1/1/1997 9:51:00 AM
From: Ken Holbert, Jr.	of 3256

I saw a great show on PBS called "Triumph of the Nerds". If you would like to see a good example of IBM's biggest blunder. Watch this film. It goes into detail of how IBM lost to Microsoft. Very interesting. Give you part of the story. IBM dragged its feet in the PC business in late 70's, early 80. Realized it needed to get into PC's and had very lttle time. IBM had never outsourced before, but becase of time constraints and losing market share decided to outsource their PC's parts and programs. Contacted BILL GATES for Basic and DOS. Bill Gates refered IBM to someone else for DOS. That DOS inventor refused to speak with IBM, so IBM went back to BILL GATES. Bill did not drop the ball this time. He contaced a DOS copier and bought the rights to DOS for $50,000. IBM used BILL GATES for DOS/Basic but allowed Bill to retain the ownerhip rights to DOS/Basic, not realizing that Cloning was possible. IBM thought they were protected from cloning because of the ROM chip being patented. Another part of the story shows that XEROX actually developed LAN's, GUI's, laser printers, the whole works back in the early 70's. Only to shelve the idea because in their words, only houswives keeping receipes would use personal computers. The moral to this story is that the little guy's can and do win. IBM and Xerox's beuaracracies did not allow them to see the light. Had XEROX followed through we would be light years ahead with PC's and IBM would be a lot smaller company than it is now. No doubt IBM and XEROX have learned from their mistakes. If KM works IBM will play ball if it has any sense.

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