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

To: PCSS who wrote (78588)	2/22/2000 6:51:00 AM
From: QuentR	Read Replies (1) \| Respond to of 97611

Door Is Open For Compaq To Regain Desktop Edge CRN Reseller Poll:Hardware -- February 22, 2000 John Roberts & Warren S. Hersch New York - Dell Computer Corp. is losing momentum in the small- and midsize-company market, opening the door for Compaq Computer Corp. to take control. The only question: Will Compaq be able to capitalize on this opportunity? Last summer, Round Rock, Texas-based Dell overtook Compaq for the top spot on the best- selling desktop list, according to the CRN hardware poll. This was the climax to a dramatic, two-year surge in the percentage of VARs citing Dell as their best-selling PC in this market segment. This percentage nearly doubled last year alone, rising to 13.3 percent in 1999 from 7 percent in 1998. But there are signs Dell's inroads are finally coming to an end. In January, 12 percent of VARs cited Dell desktops as their best-sellers, down from 14 percent in December and 16 percent in November. The January figure was only slightly above the 10 percent reading in January 1999. Six-month moving average data, which provides a longer-term perspective by smoothing out some of the month-to-month variations in these figures, confirms this recent slowdown in Dell's momentum. Following strong increases throughout most of 1999, the percentage of VARs citing Dell desktops as their best-sellers peaked in November and declined in both December and January. This is a classic illustration of the so-called law of large numbers, showing that while it is easy to score big gains when starting from a small base, it is much more difficult to keep up the big gains as the base gets larger. And when looking at best-selling desktops-or notebooks, for that matter-Dell's base has become a lot larger in the past two years. With Dell's momentum slowing, can Compaq re-establish its position as the best-selling desktop vendor in the small- and midsize-business arena? Survey data from January shows 16 percent of respondents cited Houston-based Compaq as the manufacturer of their best-selling desktop in the small- and midsize-company market. This was the highest percentage among all major vendors, and the highest figure for Compaq in particular since last April. It also was the first time since August that Compaq grabbed the top spot on the best-selling desktop list. "Compaq has taken steps toward leveling the playing field with competitive pricing," said Mike Wintory, president of MicroAge Galesburg, a VAR in Galesburg, Ill. "This has enabled VARs like us working in a smaller tertiary market to compete head on with the computer superstores and mass PC merchants." But Compaq's recent plans to sell more PCs direct to the business market could hinder further upward movement, according to CRN survey data. Two CRN spot surveys show between one-half and two-thirds of responding VARs would shift business away from Compaq if the vendor goes through with its plans. In all, 200 VARs responded to the January survey. Other results from the survey show white boxes are strengthening their position in the small- and midsize-company server market, as VARs that build their own systems look to key in on profit opportunities in this market segment. After languishing during the summer months, the percentage of VARs citing white-box servers as their best-sellers has jumped up. For example, 32 percent of VARs surveyed in January said white-box servers were their best-sellers, one of the highest figures in the past year. "White-box servers are less expensive to build and offer better margins than branded machines," said Terry Gray, vice president of sales for Ohio Cash Register Inc., a reseller in Medina, Ohio. The white-box server comeback has nipped at the percentages of some major vendors. Compaq still is holding its own, but the percentage of VARs citing Dell servers as their best-sellers dropped to its lowest since last May. crn.com Copyright c 2000 CMP Media Inc. By John Roberts & Warren S. Hersch

To: PCSS who wrote (78588)	2/22/2000 7:08:00 AM
From: hlpinout	Read Replies (1) \| Respond to of 97611

Hi Michael, Here you go. -- February 22, 2000 Cabletron's Aprisma Signs Pact With Compaq, Expects Spinoff By WILLIAM M. BULKELEY Staff Reporter of THE WALL STREET JOURNAL Cabletron Systems Inc. expects annual revenue growth of 50% to 60% at its network-management software unit, Aprisma Management Technologies Inc., which it has selected to be the first of its units to be split off under a breakup plan. Aprisma also expects to announce Tuesday that it has reached an agreement with Compaq Computer Corp., Houston, under which Compaq's professional-services organization will resell at least $25 million of Aprisma's Spectrum software over two years. That would amount to about 15% of Aprisma's current volume. Compaq will take an equity stake of less than 2% in Aprisma for $14 million. Aprisma is likely to file a registration statement in April or May, said Michael Skubisz, who was designated president of the unit when it was formed in December and will be chief executive of the independent company. He said it is likely to sell less than 20% of the company for $100 million to $200 million. Analysts expect the IPO pricing will value the whole of Aprisma at about $1 billion. The rest of the company will be spun off, tax free, to Cabletron shareholders. Mr. Skubisz said Aprisma has recorded sales at a "run rate" of about $20 million a quarter, and said that he anticipates growing 50% to 60% annually for the next two years, because of exploding demand for its software that monitors computer networks and Web sites and warns system operators of service slowdowns and breakdowns. Write to William M. Bulkeley at bill.bulkeley@wsj.com