I anticipated this happening. In order for MSFT to grow they are going to have to compete with their customers. ORCL has done this very successfully but MSFT is different. You see, they have a monopoly position with their customers (i.e., DELL, CPQ, HWP, etc.), so if they start competing with them you will see a huge shift in loyalty to a competing platform (i.e, Redhat). This is really shaky territory for MSFT. See below.
eMachines To Make Microsoft Devices
.c The Associated Press
REDMOND, Wash. (AP) - Low-price computer maker eMachines Inc. will produce easy to use Internet devices for Microsoft Corp., the two announced Monday.
Irvine, Calif.-based eMachines will make MSN Companion devices for the software giant's Microsoft Network.
MSN Companions, which are also being made by manufacturers such as Compaq and Acer, provide access to e-mail and the World Wide Web through a dial-up service. They are not full-fledged computers and can't be used to play games or write any kind of business documents.
EMachines plans to sell the device for $349, but MSN will offer a $400 rebate if consumers sign up for a three-year Internet service contract at $21.95 per month. Monitors, however, will be sold separately, unlike MSN Companion devices made by other manufacturers.
Shares of eMachines rose 12.5 cents to $1.13 in afternoon trading on the Nasdaq Stock Market, where Microsoft stock fell 75 cents to $54.81.
On the Net:
e4me.com
microsoft.com
AP-NY-10-09-00 1222EDT
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