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Technology Stocks : SDLI - JDSU transition

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To: pat mudge who wrote (975)4/1/2001 3:11:23 PM
From: speedskier  Read Replies (3) of 3294
 
Hi Pat,

. When you can go to EBAY and see Cisco routers and Sun Workstations selling at 30% of list, and not
getting bids, things are tough. And I just don't buy into optical being some sort of island in this part of the
business cycle


Over the last couple of years new Cisco hardware has typically sold at 30 to 40% off list through the reseller channel. Nobody pays list price for this stuff, so used hardware at 30% off list isn't a very good deal.

Another problem with used equipment is configuration. Except for the most basic components, such as the 2500 series router, these boxes have a huge variety of optional components you buy to fill out the basic chassis. Things like Ethernet blades, seriel connections, etc. So the chances that a used, say Catalyst 6509, has the precise components you need, is slim. Then you must go somewhere else to get the other components, ensure that firmware and software levels are compatible, etc. Software is a big issue in a network, and is sold separately. If the used box doesn't have the rev. level you use in your network, its off to Cisco for a significant software user's fee.

If you are a large reseller, liquidator, or a very large Cisco shop, it probably makes sense to buy out the .com inventories, refurbish the equipment and sell or reuse - but not at 30% off list.

Regards,

Skier
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