Intel Strategy for Achieving Wealth and Off Topic Message Board

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Technology Stocks : Intel Strategy for Achieving Wealth and Off Topic

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To: Sonki who wrote (15675)	1/6/1998 2:22:00 AM
From: ANANT	Read Replies (1) of 27012

sonki and all: Segment 0 PC's - Comments from HP - as reported in CNN-fn HP expects the segment 0 share of PC's to increase to 50% by Chrstmas 1998. The type of buyers are: Those who are replacing their 386 and 486 PCs First time buyers The high-end price of PC's have come down from $ 2899 to $2499. These are required for DVD and video editing etc. HP works with Intel very closely in a partnership and secures good prices from Intel to meet with the competition My random thoughts: Segment 0 market: I consider HP introduction of $ 800 PC using the Intel MMX is a very important step both for Intel and HP - Intel's whole-hearted penetration into the segment 0 market. By the end of 1998, these PC's may still go down in price probably to sub 500. By that time Intel may flood the market with cheap stripped down version of Pentium II's. As a industry leader, Intel ends up creating a huge segment 0 market around the world. While the margins could be razor thin, penetration into this segment 0 market is vey significant and may give nightmares to the competition. Intel is great in creating various needs to the consumers and this leads to the upgrading cycle of next segment markets Network Computers: With the proliferation of the cheap PC's (below $ 500 with lot of local storage)in the consumer market, I question the relevance of the so called network computer touted for low cost. It loses most of the cost advantage. While some businesses may still prefer a network computer with the ease of software maintenance and the resulting savings, I do not think the network PC will attract the attention of non-business users. Already we see the need for 3 or 4 computers in a typical family perhaps connected to a server powered by Pentium II at home. As the internet use explodes, the need for high powered servers also increases. Once again Intel wins. Now that we are going thru the Intel product transition time, we have to be patient for the next 2-3 quarters before we could see significant Intel penetration in all segments of market place and increase in Intel earnings. Once Intel stock price starts moving upward, the stock does not look back. Recall the stock movement around the first par of 1997 before and after split. IMHO rgds ANANT

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