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

To: Mike Van Winkle who wrote (144591)	10/14/1999 1:05:00 PM
From: rudedog	Read Replies (2) \| Respond to of 176387

Mike - Dell's model is unaffected by long term contracts. The reason DELL killed CPQ and everyone else in 1998 was that they were able to pick the lowest cost components and get those into boxes faster than anyone else. Long term contracts reduce their ability to do that. It doesn't revolutionize their model but it certainly changes it. I have talked to a variety of folks in the components business and they assure me that there has been a BIG change in the way DELL does business with them over the last 6 months. Second, the LCD shortage was the issue being addressed and the deal was with S. Korea not Taiwan. How did Taiwan get into this? For sure DELL is doing the Samsung deal to get LCDs - I did a fairly detailed post on that. Make up your own mind on how good a deal it was. But what about the Acer deal? What about the 2 deals with IBM? Have you thought about where those fit in? Assuring a source of supply for a critical component is strategic rather than tactical but not breathtakingly so. CPQ invested in the Samsung relationship 5 years ago and worked to assure their LCD supply 2 years ago. DELL is about 2 years late to the Samsung party and only went there after their other supply had been drying up for nearly 6 months. And they don't get any assurance of parts for another 2 years.