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Technology Stocks : Apple Inc.
AAPL 260.21+0.3%Jan 12 3:59 PM EST
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To: HerbVic who wrote (13619)5/14/1998 10:00:00 PM
From: Bill Jackson  Read Replies (2) of 213182
 
HerbVic, Apple is still ponderous in inventory terms, partly because they are new to the skinny game and partly because they have baggage...the dealer network, that they cannot just throw to the wolves by going totally direct sales like Dell. If they can keep their margins up enough to allow 15-20% margins to dealers and make at least 15-20-% themselves is the question. Loads og high margin OS sales will help this. They may at some time have to throw the dealers to the wolves, those that are left anyway. Most dealers also carry assorted Wintels as they have seen wall writing that they thought = Apple dead, and they diversified into WIntels. Many actually dropped Apple totally.
Apple needs vertical integration in chips to cut costs. Can they buy Motorola?, have they the money to do that? Can they buy another chipmaker with the G3 licenced capability?. As it stands Motorola/IBM can control Apples destiny by simplee chip price
decisions, as those chips are only nominally competitive with Intels chips. In fact Motorola could cut chips prices by 60% and still make good money and that would make a huge duifference to Apples margins for dealers, itself and also to cut prices to compete with Wintels.

Bill
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