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Technology Stocks : QUANTUM
QNTM 9.380-4.7%Dec 12 9:30 AM EST
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To: Rational who wrote (6723)12/14/1997 4:14:00 PM
From: Rob S.   of 9124
 
One factor that becomes increasingly important to OEMs as ASPs for PCs decrease is the reliability of the componenets they use. I think that a lot of the success of Compaq in the sub $1,000 market is ude to the use of low cost but reliable components and mfg. The highly successful Pressario 2200 series uses the Cyrix/NSM MediaGX part that integrates audio, video, system I/O, and MPU into a simplified chip set and does away with the seperate boards and SRAM cache. Few components leads to greater reliability at lower cost.

When you sell something as complex as a PC for a lot less money, the cost of quanlity assurance and handling of service and returns can make the difference between profit and loss.

I have noticed that Quantum has been able to maintain a slight margin above the pricing of their "cheap" competitors. I don't think that is all wishful thinking - major OEMs test thoroughly for reliability and will pay a bit of a premium for it because the "total end-to-end cost" is lower.
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