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

To: rudedog who wrote (153302)	2/8/2000 3:22:00 PM
From: jim kelley	Read Replies (2) \| Respond to of 176387

Dog, ASP's always drop in the PC industry over time. They would drop if DELL did not exist. IMO DELL should be severely penalized by Wall Street for making a profit in an industry where CPQ, HWP, and yes- even IBM are loosing money. It is clear to anyone with a brain that CPQ, HWP and IBM need all the help they can get from the analysts because they certainly are not going to get any help from DELL. DELL should be punished for showing a profit and being a cash flow cow because that is just one step away from corporate senility. It is clear that the real winners in the pC business as well as the internet businesses are the ones that are loosing money at phenomenal rates. After all they have no where to go but up. They are the value plays. While we all know that DELL's growth rate has no place to go but down. It deserves to be punished for its success. So you are correct DELL must pay the piper for its success. I hope you will accept my opinion in the spirit that it is offered. JK

To: rudedog who wrote (153302)	2/9/2000 4:54:00 PM
From: D.J.Smyth	Read Replies (2) \| Respond to of 176387

rude. you make a plausible argument for not owning Dell, the stock. however; there are PC price points which will never be ceded by suppliers. this results in establishing a base price point; or stable ASP. Or, on the other hand, if you break the stable ASP for too long you loose your supplier base. Once you lose your supplier base, you have the "heating oil" effect witnessed this past month. If, as you suggest, HWP, CPQ, IBM (Triumverite) use the PC as a continued loss leader, the functionality (available options) of the PC will also decrease. If the functionality of the PC decreases, the other factors of Triumverite's business will very rapidly suffer. You cannot continually whip your favorite child and expect the other children not to rebel. If the Triumverite excersized the PC as the loss leader, they will in effect be killing the goose that lays their eggs. ALL SYSTEMS UPON WHICH THE TRIUMVARITE BUILDS IS PC CENTRIC. The buyers of "other equipment" and "other services" will demand price erosion on ALL FACETS as well. It's kill or be eaten. Price erosion on ALL FACETS leads to broken suppliers and non-available parts. The ultimate result is a non-functioning PC economy where making a profit is the domain of only one or two. A 40% erosion in ASP would equal a 70% erosion of the supplier base. The sum of the parts are not created to withstand a total erosion of the whole. Functionality suffers; all other revenue forms suffer. Functionality is NOT decreasing in PCs. It is INCREASING WITH INCREASING NEEDS. The 3g picture will require complete renovation of functionality over the next two to three years. That is "complete". The major problem I have with the PC for Asia, where world growth is shifting, is the complex language. Keyboards don't cut it (thus mobile phones are more prevelant). Nokia believes the mobiles will be all the Asians need. Dell has some opportunities here to re-invent PC centric designs. Their model needs to force them into innovation as opposed to rennovation.