Merrill Lynch on the Post-PC Era
(someone please give these guys a clue about WIND)
From Briefing.com
11:41 ET ******
Post-PC World : Microsoft's (MSFT) pessimistic conference call last Thursday focussed on weakness in business PC demand and the possibility that there might not be a significant reacceleration over the coming year. That caution is prompting some understandable questions about just what the Microsoft pessimism means. If feedback from many of our readers is any indication, there are plenty of observers who are skeptical about Microsoft's bleak corporate PC outlook, believing that it is a cynical ploy to lower the bar going forward or to reduce pressure from legal proceedings by intentionally appearing vulnerable. But Merrill Lynch has another take on this news; its analysts are looking ahead to a post-PC, network-centric world in which demand shifts "above" and "below" the PC. Above the PC are servers -- emphasis at enterprises is shifting to servers and away from PCs, which could slow the corporate PC upgrade cycle and lead to a product mix that favors lower end machines. Below the PC are information appliances -- mobile Internet access is leading to the rise of handhelds, cell phones, and perhaps other unimagined Net appliances that replace some functions of the PC. As a result of this assault from above and below, Merrill Lynch analysts are looking to investment opportunities for the post-PC era. Above the PC, they recommend equipment makers Sun Micro (SUNW), EMC (EMC), and Network Appliance (NTAP), while software companies that sell into server-centric, ecommerce environments are also emphasized: Oracle (ORCL), Mercury Interactive (MERQ), Ariba (ARBA), and i2 Technologies (ITWO). Below the PC, Merrill recommends Lexmark (LXK), Research in Motion (RIMM), and Palm (PALM). Merrill is clearly in the camp that believes the Microsoft news was not just a case of the company once again sounding its usual cautious note. Instead, this may be the first indication that a new post-PC world is beginning. If that's what Microsoft is seeing, its officials certainly weren't willing to admit it. But their emphasis on PocketPC, their Internet properties, and an upcoming SQL Server upgrade might hint that they are concerned that the paradigm is shifting away from their core PC business. - Greg Jones, Briefing.com |
