Stock Bull, I thought your name meant you were Bullish, not full of it.
Emulation of the direct model is possible, but not until the competition decides to move to direct marketing. Until that time, they will be bogged down by the inefficiencies of their indirect models. This will allow DELL to maintain a very significant operational/financial advantage for the next couple of years, to be sure.
I'm not blind to the pitfalls, but please get real. If you cut through the BS and look at the numbers, DELL is doing better and better each and every quarter. It's not that hard to see.
Declining ASPs are not as big of a problem as they are being painted to be. Margins are still being maintained, and DELL's competitive advantage gives it the upper hand to preempt a significant price war. BTW, there is no price war going on. It's CPQ, et al, purging the sewage from their distribution channels. They can't afford a prolonged war, and won't wage it. The direct model has been, and will continue to win. They better wise up, and get cracking.
Regards,
LoD |
