Compaq Message Board - Msg: 13252592

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Technology Stocks : Compaq

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To: JDN who wrote (79786)	3/21/2000 6:36:00 PM
From: rudedog	Read Replies (2) of 97611

JDN - re: Maybe you all saw the press release wherein CPQ is going to GIVE $1 Billion (with a B) to internet companies I think you misread the article. This is an extension of the CPQ leasing model - an innovative program which allows users to buy the "power" needed without actually taking the hardware. I believe this, along with their other ASP programs, is a good way for CPQ to go after the 40% of the $16 Billion (with a B) ASP hardware business that they have targeted. This is known in the trade as a "provisioning" model and is likely to be offered by HP and IBM as well. SUNW has been talking to customers about a similar model for their systems with a twist - the users "buy" only what they are actually using, so if they buy a 32 way UE6500 but only use 8 processors, they pay about what a UE3500 would cost. It looks to me like CPQ's model makes more money.

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