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Technology Stocks : Dell Technologies Inc.

DELL 120.45

-0.1%

3:59 PM EST

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To: BGR who wrote (109310)	3/12/1999 7:02:00 PM
From: Kenneth Aird	Read Replies (1) of 176387

During the kickoff video conference Dell indicated that Gigabuys has no inventory. I ordered some Red Hat software from the site, and the shipping address on the label was not in Texas. While the price I paid was significantly below what I would have paid through the Red Hat web site, I won't argue that I could not have got a better price somewhere on the web if I wanted to search for one. I will pay a few dollars more to deal with someone I trust to deliver reliably and stand behind the product. Advertising based web sites will have to continue to satisfy their customers or they will lose them as fast as they got them, and the advertising revenue will follow. Granted the net will lower margins for everyone in the software and accessory business, but Dell already thrives on net margins much lower than those in the software business. I paid $33 for a CD-ROM that cost $0.50 to produce. Soon Dell will deliver that same CD to me over a broadband internet link at virtually zero cost. The value added is in the customer relationship, not the best possible price for a commodity product. As they said in the video conference, people want to buy the computer, accessories and software all at once from one vendor without having to hunt all over the web. It gives a sense of confidence that you won't get into finger pointing games if one product doesn't work with another. If there is a cost to Dell, it will be in the support calls they get when people try to install the accessories and run the software they bought through Gigabuys. If this is the start of a move into the consumer market, then that will be the next big challenge. Dell is better equipped to meet this challenge than anyone else in the business, IMHO. Ken

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