HP makes wonderful peripherals - printers, scanners, and fax machines. I've got a half dozen of their gadgets and am very pleased with them. That's not counting the HP calculators - husband's had one for years, just ordered one for younger son, who likes RPN (reverse Polish notation - you don't need parentheses). Compaq computers are set up with quirky software, but the machines themselves are inexpensive and reliable. I've got three of those. Compaq IPaq is the top non-Palm PDA, and HP Jornada is right behind.
My own bet is that you are right that they are joining up to be a full-service company, but I doubt that they will "fail, gurgle and drown." Dell doesn't make printers, scanners, fax machines, scientific calculators or PDAs, and not many people in the US are going to buy things like that with a Korean label or even Chinese. I am willing to pay up for the brand name because of my positive experiences with the companies. Cheap is important, but reliable is more important.
My other bet is that the real reason probably has something to do with economies of scale bidding for government contracts, where fractions of pennies matter, but also the track record of the bidder. I don't think Korean or Chinese companies get to bid on US government contracts, especially not for the Defense Department, CIA, NSA, etc. Those guys use a LOT of computers.
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