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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: John Hull who wrote (86548)	8/3/1999 1:13:00 PM
From: dmf	Respond to of 186894

Hello John: RE: Intel takes Sun VERY seriously Thank you for your comments on SUN's new CPU and the way they offer complete server and workstation solutions. I actually thought about calling out for your help on this since I felt you would AFFIRM the fact that Intel appreciates Sun's strengths. I also felt you would remind the thread of Intel's volumes and focus. Do you feel that Sun's MAJC might be a low-cost solution where Intel will offer a higher priced solution? Am I misunderstanding the threat/impact of MAJC? Someone just posted a link on the SUNW thread: sun.com Intel recognizes that the higher end chips (and solutions) are more profitable when they offer a recognized advantage. Sun has shipped fewer processors but they have offered high end solutions and reaped the benefits. In the past, Sun's solutions have been more expensive. MAJC sounds as if Sun is planning a solution that will be aimed at a mass market and offer a price advantage. Perhaps this is meant to counter the MERCED attack aimed at Sun's established base. Intel is now offering 4-way and 8-way systems (not counting the Caltech or Sandia type installations!). How long has Sun offered such systems? The focus has been different. In the past, Sun was not trying to produce for the masses, so the low volumes do not tell the entire story. Sun is also adopting a different business model for JAVA, JINI and MAJC, that allows developers low cost solutions and SUNW expanded profits as devices are introduced by a number of manufacturers, in volume. I am impressed with both companies and my investments have been rewarding, to say the least. Thank you for speaking up when the thread is considering new information. The competitive situation is far from clear. Anything you can add is appreciated GREATLY! dmf

To: John Hull who wrote (86548)	8/3/1999 3:23:00 PM
From: Joey Smith	Respond to of 186894

John, thanks for the analysis. I think you are right on. SUN is trying to vertically integrate everything, like you pointed out, from the software (JAVA, Solaris) to the hardware (chips that are "optimized" to run the specific software) to eventually the box itself. Problem with this business model is that SUN will never become the volume supplier since it will be competing with its customers when selling the end systems. Why would a Dell, Compaq, IBM choose to become dependent on a competitor like SUN for a key component? At best, SUN will form an alliance or two with an OEM to promote the chip, but they will never surplant Intel as the volume leader. joey