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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Meathead who wrote (134881)	6/29/1999 12:41:00 AM
From: hdl	Respond to of 176387

Dell can lease computers for cost plus cost of funds plus a few % profit on the interest. Then, it makes its money on the residual value-what it gets for selling it when it comes off lease. This lets it compete still better as it can lease at cost. It doesn't cannibalize sales. It increases sales. Just as almost all who are in the market for a sub $500 new machine wouldn't buy a Dell, almost all those who buy used computers wouldn't buy a new Dell. But, those who return the leased Dell, may well buy or lease a new Dell. For more, pay me or contact the American Association of Equipment Lessors. Dell longs can afford my outrageous rates.

To: Meathead who wrote (134881)	6/29/1999 10:18:00 AM
From: Craig Lieberman	Read Replies (3) \| Respond to of 176387

Meathead, The added benefit of dellauction.com is that it increases traffic to DELL branded sites. An auction site will generate interest more repeat visits than a fixed price site because people will be looking for a bargain. Some of those people will get tired of it all and just click on over to price the new machines and the most convienient site to do so will be www.dell.com . More visits to the auction site will translate to more sales from the new site also.After all, how many times have you gone to the store for one thing and come out with 3 things that you didn't intend to buy initially. It is recycling at its finest turning something that was scrap into a product again. Since all of the cost of the system was recovered in the lease, anything they make (even $100-400) will be pure profit. Since DELL doesn't sell units in the under $600 range, they will not canabalize their own sales. This is a way DELL can have a presence in the low end market without having ASP to cost price squeezes. They are selling a $400 box that cost $0. The competition is selling a $400 box that cost $600. Craig