John, thanks for the post. Missing out on sales opportunities is never good since demand is perishable and the more the product is a commodity, the more perishable it is as the business goes to their competitors. Bad problem brought on by sole-sourcing commodity. Sole sourcing brings many benefits such as volume discounts, better overall price structures, enhanced productivity in negotiating and managing a supplier, etc. but this is the big draw-back; supply problems that can't be fixed any way other than through the current supplier. Anyway, all PC companies face this since they all basically sole-source for the advantages it brings.
Regarding product allocation, it is probable David and others like us would be lower on the food chain for getting supply. The IBM Consent Decree, which mandated sequential delivery, has been vacated for this term and even when it was in place applied within a channel not necessarily between channels. It is unlikely IBM will accept losing big government deals or university deals like UNC or Wake. They will allocate as necessary to insure delivery. What independent research firms doing market studies miss when making predictions of who has share is the fact that IBM has so many channels some of which have no tracking opportunity such as the "blue suit" direct sales teams that still cover all of the major customers.
Anyway, it is not good but probably will not materially affect the third quarter performance especially in the area of earnings.
As an aside, if you are looking for a new system and do not need to be mobile, the IBM 300 series of small business systems offers a better package. I recently got a robust 300 GL with cable modem and it is working out very well. |
