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To: hlpinout who wrote (89409)	2/1/2001 6:49:20 AM
From: hlpinout	Read Replies (1) \| Respond to of 97611

From The Register. -- Dell disses handhelds and Net appliances By: Lucy Sherriff Posted: 31/01/2001 at 13:24 GMT Say what you like about Michael Dell, the man certainly does not lack confidence in his product or his business strategy. When CEOs of big computer companies come to talk to the press, you expect to hear a lot about their vision of the future. Speaking in London today, Michael Dell spent more time shooting down other visions that he did expounding his own ideas. For Dell, the PC will remain central to people's lives and continue to be one of the most important ways we access the web. "I think if you look in rooms on college campuses you get a good idea of where we are going with technology," he said. The PC at the centre of an entertainment system, replacing the hi-fi system and often the video too. But what about all the other devices that have been produced, all those Internet appliances we keep hearing about? A good question, according to Dell. "What did happen to them all?" In particular, what about the handheld market? It isn't a priority market for Dell, which is concentrating more on the server market and corporate PC's. "In five years time, handheld and notebook markets will be similar in terms of unit volume," he said. "But in terms of revenue, handheld will be nine per cent to notebook's 91 per cent. I think it is clear from that which is more important." Dell says it will get more interesting once wireless technology is embedded in the Palm's and PocketPC's. "But we are going after the high end first," he said. And Bluetooth? He stopped short of calling it a load of hype - and did stress his company's commitment to it as a communications standard - but it was clear that as far as Dell is concerned, Bluetooth is a cable replacement technology, nothing more, nothing less. The way forward for wireless connectivity is 802.11. Ok, so what about net access via a mobile phone? Forget about it as a serious competitor to the PC. "The way human being process information is essentially visual. The screen on a mobile phone is just too small. Even as the displays get larger, it will continue to be a problem." All of his arguments are valid, indeed often ones we have used ourselves, but you can't help feeling that he might be missing the point a bit. Dell is not a visionary by any stretch of the imagination, and seems to be suffering from a kind of inertia. However, Dell's market share is up, growing faster than the rest of the industry in all markets it is involved with, so it may be that he is on the same wavelength as the general public on this one. But the overriding impression I got from the briefing was of a man who had a good idea and made a lot of money selling computers. Good coffee though. ®

To: hlpinout who wrote (89409)	2/1/2001 8:36:01 AM
From: hlpinout	Respond to of 97611

Storing Value January 31, 2001 1:10:00 PM ET Perhaps the sexiest thing about the data-storage industry is its stocks. From EMC to Compaq Computer, storage stocks have weathered the past year's market carnage better than most other tech sectors, resulting in high visibility for companies that do otherwise invisible work. The importance of storage services can be explained in one key word: data. Data traffic is expected to increase exponentially in coming years, a fact that should surprise no one (compare your e-mail activity today with what it was three years ago). That's information companies want to store and use, and they'll pay a premium for systems that do it. The need for reliable storage was made pointedly clear during the months of concern over the Y2K bug, a crisis that observers say put the sector on the proverbial map. "Storage is probably the most critical thing out there right now in terms of the hardware market, and I don't think many companies are willing to skimp in that area," says Joseph Beaulieu, senior analyst at Morningstar. "Companies are relying on the data that they gather about their customers and their purchases to go back and sell more products. These aren't just filing cabinets, where they stuff things in there and never go back and look at them again." And hence the growth of the overall market. Storage is currently a $44 billion business, according to Gartner Dataquest, and is forecast to double to $88 billion by 2004. The largest growth is in the areas of storage area networks and network-attached storage (or in in storage jargon, SANS and NAS); both markets are expected to grow at rates upward of 50 percent in coming years. That rise reflects both a general migration toward a networked environment and a corporate switch from host-based storage (handled on a company's internal server) to external networks. Also poised for growth is storage-management software, a business expected to grow at an annual rate of 28 percent for the next five years. While the sheer size and potential of the storage market are sure to promote fierce competition, so far there is one name that analysts say is synonymous with the sector: EMC. The company's stock performance might be reason enough to pay attention – it's returned more than 3,000 percent in the last decade and now sports a market cap of $172 billion. (That's huge: about $100 billion more than Hewlett-Packard, for instance, and just a bit behind IBM, at $204 billion.) But EMC also has managed a 16 percent market share and has repeatedly turned in strong earnings. The company consistently tops estimates; that's one reason it trades at a gaudy 70-plus times estimated 2001 earnings of $1.03 a share. Observers say a laser-like focus is responsible for the company's achievements; while its competitors struggle to establish a niche in one part of the market, EMC is all storage, all the time. "In an area that is technologically as complex as storage, you do get a benefit by being completely focused just on that area," says Don Easley, a manager of the T. Rowe Price Science & Technology Fund, which counts EMC among its holdings. What's more, EMC has been focused on storage for a decade, preceding its competitors. That jump has allowed it to compete in every corner of the business, including storage subsystems, software and networking, notes H. Clinton Vaughan, analyst at Salomon Smith Barney. While EMC's high valuation poses some concern to market observers, Vaughan says the company's position in the market helps to justify it. And yet, despite its formidable position, EMC is not quite the only game in town. Veritas, a leading storage-software maker, is a strong competitor that could prove a bigger threat in coming years. Network Appliance has a small but solid foothold in network-attached storage, while Brocade Communications Systems stands strong in the networking arena. And of course there are the bigwigs like Compaq, IBM and Hewlett-Packard, which go head-to-head with EMC for the core business of storage area networks. The storage market enjoys one more, perhaps crucial, advantage: It should be relatively immune to the spending cuts that will affect the IT industry should the economy slow. "Whether we're in a recession or not, it's not going to change the number of e-mails I send out," says Easley. "While I may not buy that other PC, I will buy storage. That's why it's held up so well." Visit www.thestandard.com for The Industry Standard's full coverage, news, and analysis of the Internet Economy.