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Pastimes : Georgia Bard's Corner
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To: Ga Bard who wrote (4031)7/22/1998 11:21:00 PM
From: East  Read Replies (1) of 9440
 
I saw some posts earlier about PHOX this post is entirely from a Computer reseller view and I have not done any financial research on the stock itself.

Based on what I read in the PR, I would say not much profitability to be had in those products. The problem is that DTC has always aimed at the "In-House Clone" market. PC's assmebled by a reseller such as myself. Over the past year or so the major mfg. ie Compaq, IBM, etc have started to produce very low cost "Consumer models". This has caused many resellers to stop building their own PC and move to the Major Mfg arena. You have less time invested and the cost difference is minimal unless you sell complete junk. Let me just break it down as I see it.

1. The PC Hardware market is one of the most cut throat businesses there is. Constanly, companies are going under because of one mistake. Profits are not high even for Mfg's right now, unless they have some value added product or software, which is usually not beneficial to the Part mfg only the full system builders or resellers.

Sound Card:
1. NEG - Built on the mother board of most major Consumer model Mfg. so unless you are selling the chipsets you don't get that business
2. NEG - Those that are building there own, The average price I pay for a Sound Card is about $15. Got to sell alot of sound cards to make money.
3. POS - Almost every PC sold now does have sound capabilities so if they do sell their chipset to a major it could be big money.

VIDEO CARD:
1. NEG - Same as 1 & 2 above only Video card are about $25-30 for low end
2. NEG - Unless DTC breaks it normal low end aim, they won't get the major MFG markets. Most Major Mfg's are moving to High end Video for Full motion video and Internet graphics.

Modems
1. NEG - The modem market is already saturated so I would not say this would help at all. Also so much new technology in the near future that they would have to make a major shift to heavy R&D of new technology rather than producing cheap existing technology.

Cases:
1. It has been my experience that IBM is not very loyal to their suppliers. They could very easily drop this supplier with little notice.

DTC Current Hard Drive Controllers:
1.NEG - Very little call for add-on EIDE Controllers since most are built in.
2. NEG - Most of their SCSI Line is low end (RAID 1&2)
3. POS - Their standard SCSI contollers are ASPI (Adaptec) compatible and are considerably cheaper.

I have sold several thousand DTC IDE controllers in the past on 486's. They seem to make a decent low cost product, but their market is shrinking.

This is all just my experiences in my little corner of the world but I thought that it might be helpful to some who might be looking into this company.

East
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