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Technology Stocks : Dell Technologies Inc.
DELL 125.07-1.7%11:15 AM EST
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To: jim kelley who wrote (49831)7/6/1998 10:07:00 AM
From: rudedog  Read Replies (3) of 176387
 
Jim -
IMO CPQ's biggest problem over the next 3-5 years will be how to maintain the extensive proprietary product lines (Open VMS, Tandem NSK) while controlling R&D costs in those areas. They have a lot of valuable IP and knowledge, and also some of the best people in the business, but the large ongoing investment does not fit their business model or the markets where the most growth will occur.

The areas where they have the most strength include clustering (between DEC and Tandem they have about 70% of the patents in this area and also most of the people who understand that technology), high reliability systems (OpenVMS has availability in the range of 99.99%, NSK is better than 99.999%. NT by contrast is less than 99% available), But turning those strengths into $$$ in the market is a hard problem, and supporting the thousand or so technologists who support the technology is an expensive proposition.

CPQ has started to move to standardization of that clustering technology with the VI Architecture but as you point out they are caught between a rock and a hard place - to succeed they need to make the technology broadly available, but this course also eliminates their proprietary edge. This turns into a running game - can CPQ keep an edge in the market which customers will pay for while still driving standards?
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