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To: pater tenebrarum who wrote (18249)	9/14/2000 11:29:52 AM
From: chic_hearne	Read Replies (1) \| Respond to of 436258

You're wrong about the semi cycle, as many others are. Time will tell... FWIW-- making some sense out of inventory buildups in Solectron, etc. In the past (few months ago), IBM would take inventory control of parts upon delivery and the parts would be considered "sold" by the component manufacturer. Now, we don't actually take control of parts until about 48 hours before they go into the server. Everything runs the same way, except there is a warehouse across the street run by a 3rd party that acts as a parts warehouse. They take delivery from hundreds of manufacturers, but the parts stay on the component manufacturer books and not IBM's until they leave the warehouse. In other words, millions and millions of dollars worth of parts are now on the component manufacturers books that previously would've been on IBM's books. If other companies are doing the same, this may explain why inventory buildup seemed so big. We have a massive parts shortage here which just doesn't make any sense to me considering that inventories have supposedly gone up. I'm here in the field, I should see inventory buildup, I don't, all I see is parts shortage after parts shortage. Something doesn't jive here, I doubt IBM is an exception. As to why IBM went to this system that now costs them twice as much as the old system and provides absolutely no benefits except we can tell wall street we don't have a big inventory of parts, well, that's a whole different story....