Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : IBM -- Ignore unavailable to you. Want to Upgrade?

To: Jim Koch who wrote (5722)	10/21/1999 11:25:00 AM
From: Arrow Hd.	Respond to of 8218

Jim, tend to agree there is a bottom here somewhere before the end of the month as funds unload for year end closure. Long time posters know we have predicted just this scenario but a lot of the tech stocks kept on delaying the discussion. Independent consultant studies showed data center freezing in 2H 99. In addition, a lot of extra capacity was purchased ahead of the freeze for capacity reasons and for Y2K testing and when the testing is over the capacity, since it was purchased, is now available to absorb new applications and volumes. So we have a period slowdown for a few quarters as all this is absorbed. But as we discussed in a previous post, a lot of IBM revenue/profit is annuity based occurring every month and the ability to add hardware function to the major hardware servers non-disruptively so it does not impact the data center freeze is available via the microcode enabled vertical upgrades that add on line disabled but machine resident hardware function that already resides on the machine so the facility is there to make all the hardware revenue necessary for either the fourth or first quarters just by turning on dormant engines and not even shipping a single hardware set from the factory. The issue here is execution of this vertical strategy,which also drives software and services revenue/profit, and the ability to generate demand when customers have already bought quite a bit of capacity in the past year. I am travelling and have not read the details so don't know what else to comment on other than IBM decided to be very cautious now with their statements but if the Y2K issues can be mitigated somewhat and demand generated earlier in the cycle the strategy, architecture and infrastructure is there to meet the challenge.