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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Len who wrote (12528)	12/10/1999 2:07:00 PM
From: John Stichnoth	Read Replies (1) \| Respond to of 54805

Len, Re IBM. I haven't really thought through distinctions of gorilla vs. king or high prince for IBM's businesses. In addition to mainframes, big areas for them are: Direct Sales (Moore defines them as the King of this segment); Fortune 500 Relationships; Applications software for businesses (broadest assortment provided by any company, although not the largest seller of app software); Custom software development; Consulting; Magnetic storage media (have you seen their micro-drive?). This is certainly an incomplete list. Broadly speaking, I think IBM's value comes from two areas: (1) its existing relationships among large companies; they are better able than any other tech company to satisfy all of a company's technical needs; and (2) the capital they can put into new product and new technologies development. I think (but haven't heard recently) that IBM still receives more patents each year than any other company. And, I think they are getting better at bringing their ideas to market. I'm not about to say that IBM is a high flier. They're certainly not real big in any of the current tornados, and it will be a long time before the hosting business is an important part of their total. But, it is a good fit with their existing customer base. Not exactly a gorilla or king play, because so much of what they do is prince stuff. All in all, the company will grow faster than the overall economy, and will be less risky than the overall tech sector. Best, JS