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Technology Stocks : Dell Technologies Inc.

DELL 133.18

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12:59 PM EST

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To: kemble s. matter who wrote (49535)	7/2/1998 8:46:00 AM
From: rudedog	Read Replies (3) of 176387

kemble - "From today forward, enterprise customers can expect to get more value for equivalent or better technology when they buy from Dell," said Michael Dell I believe that this is a play for a segment of the enterprise market, but may work against Dell in the high end, where the customers are not buying technology per se or price performance. The margins that Sun and IBM charge in the high end do not just disappear, they go to provide services and ongoing customer support that the high end customers demand. Dell can do very well with this strategy in the corporate segment that CPQ has dominated (departmental and application servers), which should fuel the 200-300 percent growth they are targeting. But in the high end, HP, Sun, IBM and now CPQ will turn this in to a competitive disadvantage for Dell - i.e. 'Dell just doesn't understand what it takes'. I think Dell does understand what it takes, but has no easy way to go after the high end market with today's business model. This is MSD 'making lemonade' with one of the few weak spots that Dell's business model has.

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