Hi Arrow,
While most likely there will be continued Global expansion of the market for low margin sub-1000 PC, (which does not bode well for the box makers), the companies that sell the Servers which will support these sub $1,000, and even the sub $500 PCs, will prosper. Companies such as CSCO and INTC therefore, will be the major beneficiaries from this growth.
As I have discussed, I do not include IBM as one of the beneficiaries. Because IBM is currently the incumbent in the server market, and because in the future there will be many companies selling Intel Xeon and Merced Servers, IBM will be forced to further cut GPMs, just to maintain current market share.
Regards,
Jules
PS--I couldn't resist. I bought more IBM Puts this morning when IBM was at $171 1/4. The thought of being neutral, when IBM announces earnings this week, was just too painful for me to take.(g) |
