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Technology Stocks : Dell Technologies Inc.

DELL 132.42

-0.6%

12:21 PM EST

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To: Eggolas Moria who wrote (111261)	3/23/1999 5:05:00 PM
From: BGR	Read Replies (3) of 176387

Gary, I doubt if it is primarily pressure from the big US companies that is pushing the ASP and margin (which is more important than ASP IMO) down. There has been price wars in the past which DELL won hands down. IBM knows this as do some other companies, of which some are possibly more irrational than IBM. But the present pressure on ASP seems to be 4 pronged: 1. AMD getting serious about losing money by undercutting INTC. 2. Emachines, Microworkz and gang getting serious about losing money by undercutting the big boys. 3. Wall Street's tacit approval to (and even preference for) revenue growth at the cost of earnings loss. 4. And finally, market share battles. The first 3 are categorically insane position, which should unwind soon. In particular if Win2000/NT5 turn out to be the memory and processor hog many expect it to be, there may even a be solid technical reason for that. That should relieve a lot of pressure from the margin/ASP frame. Then, there will be consolidations as may be forecast from IBM-DELL talk and HP's sotto voce. CPQ may stand the ground for a while more, though. This is how I see it anyway. -BGR.

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