DEC is an established company with a large customer base and
worldwide name recognition. Anybody who ran UNIX more than
just a few years ago probably ran it on DEC equipment and
dealt with the DEC field organization. True they let their
markets run away (as did IBM for another), but they remain
a tremendous force in the market place.
Think of it this way; by buying DEC instead of building it,
CPQ (1) rescues a company that a heck of a lot of people would
rather not see fail due to financial and intellectual investment,
(2) gains the accrued benefits of this feeling as well as the
existing customer base, (3) gains the organization, and (4),
which is my main point here, avoids the very high cost of
overcoming (1)-(3) in the market place. This would occur
over and above the cost of duplicating the DEC organization,
(which IMHO is MUCH higher than the buyout price) and would
dissipate the resources of both companies.
As a final note, there will surely be major restructuring
costs which aren't included in the 9+ billion. |
