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Technology Stocks : How high will Microsoft fly?
MSFT 486.83-1.1%3:59 PM EST

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To: Paul Fiondella who wrote (8665)6/26/1998 1:35:00 AM
From: Vijay Mehta   of 74651
 
>> Everyone knows that the cost of producing those copies is minimal. If the expenses of development are already taken then apart from marketing and sales expenses isn't there the potential of adding a billion or so in net profits in the next two quarters?

The biggest cost will be the cost of supporting the product. If 10% of the users call Microsoft for technical support and use the 2 free support calls, and if each call lasts 30 minutes, that is one hour of a support engineer. If you include the overall cost of hiring a support engineer (including the high cost of employee stock options paid to Microsoft employees), it will be well into a $100-$150. I hear the support organization at Microsoft outnumbers R&D.

Vijay
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