Maybe we can put an end to the ASP argument once and for all.
Can somebody chart DELL's ASP over the last 3 or 4 years by quarter.
Can we show the corresponding cost per system and profit.
Can we show the percent change in ASP decline. If the component prices fall faster than the systems prices, then you maintain margin.
I believe that DELL offers a full line of systems. Their online catalog is filled with systems from low end to high end. If the DELL business is being forced into the low end for a larger and larger percentage of their business, then we would see that play out in their sales percentages of system types. However, isn't their number of higher end systems and servers increasing? Therefore, their own customers (the more sophisticated and business shoppers), not joe-average 1st time computer buyer, are ordering the higher end systems. They did do so, they continue to do so. When I see a decline in the number of systems that DELL ships to business and number of servers, then I would consider that a sign that the company is starting on the down slope to consumer-only low end systems.
I could have bought a low end system. I know better. They become 'door stops' (obsolete computing platform) too soon.
In my opinion, most 486 systems are door-stops now. The Pentiums have no more than a year left. The Pentium II systems are 3 years from that category now. Basically, we should be looking at the installed base as our customer base for DELL. As the 486 systems are retired, most people are looking for a significant upgrade. The more systems installed, the larger the customer base. All of these 1st time buyers with Pentium 266 with MMX systems will be looking for the Pentium III systems in 1-2 years. For that reason and others, I am a DELL long.
Craig |
