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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: Wyätt Gwyön who wrote (55745)	9/30/2001 1:24:02 AM
From: elmatador	Respond to of 77400

Thanks for this posting. I am in the process of confirming an assumption: My assumption is: Lots of gear junked pre-Y2K activities are perhaps being sold in the gray market. They are 'bundled' with the gear labelled 'remains of the dot.com bubble. Suppose there are gear that weren't replaced during the Y2K time. The company dind't replace that gear, year 2K came the gear didn't budge. The guy thought: Wait a moment! Stop that truck get that equipment back in here and lets run a few tests. It proved the gear was OK. So, why not sell it and a make a buck out of it? It is an assumption only I am now researching to see if this is happening. I trying to understand if it was huge amount of gray market gear that de-railed CSCO fabled forecasting software. I find it an anomaly that up to December J. Chambers was optimist.

To: Wyätt Gwyön who wrote (55745)	9/30/2001 2:21:12 AM
From: elmatador	Respond to of 77400

"...marketing strategy and profits can be disrupted as forecasting and pricing decisions become increasingly complex when sales and market data are inaccurate due to unknown distribution and sales patterns..." in "Strategies for Combating Gray Market Activity.(the growing pressure to stop gray markets, or the distribution of products through unauthorized channels)" findarticles.com As you see here it may be the case that gray market torpedoed CSCO forecasting software.

To: Wyätt Gwyön who wrote (55745)	9/30/2001 2:25:14 AM
From: elmatador	Respond to of 77400

It can be that CSCO encouraged gray market activity to sell new stuff (when CSCO didn't have a widespread distribution channels and was seeking to achieve high market share) and then it backfired after Y2K situation. The Product Development Cycle The first variable considered is length of the product development cycle. Some high technology firms are in markets, such as pharmaceuticals and aerospace, where slower development cycles are appropriate (Gupta and Wilemon, 1990). However, the authors discovered these firms have found that shortened product development cycles have provided them a competitive advantage. Their study further showed that aggressive high technology firms find this competitive advantage has its own risks, such as poor product definition, product quality issues, lower product reliability, and technological uncertainties. The authors find that as a company’s competitors shorten their development cycle, the company can not slow theirs. To assure product reaches the largest possible number of customers, any distribution channel may be used. This leads to the third hypothesis: H3: There is an inverse relationship between the length of a company's product development cycle and its willingness to encourage gray market activity. Growth Strategy The next firm specific variable to consider is growth strategy. Some firms, particularly in the high technology market place, use a high growth strategy to obtain market share (Gupta and Wilemon, 1990). These firms may develop the strategy to use gray market activity and trade short-term profits to increase market share (Cavusgil and Sikora, 1988; Cespedes et al. 1988; Ciber Working Papers, 1995; Meyers, 1999). Further, in a rapidly changing technology environment and rapid product development cycles, a short-term trade off may span the entire lifecycle of some products. With this in mind, the sixth hypothesis states: H6: There is a direct relationship between a company's growth strategy and gray market activity. dcpress.com If the case is that CSCO is suffering from gray market, they have all reasons in the world to be buying the Y2K junked gear and crush it. It can be also be argued that CSCO is overmanned because they don't want trade secrets to go public.