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

To: Charles Tutt who wrote (7594)	4/9/2002 1:24:51 PM
From: Arrow Hd.	Respond to of 8218

Hi Charles, some interesting points but I would say it is more of a hybred situation. An internal product manager certainly negotiates with other IBM organizations for commodity and you can characterize this as a "customer" relationship but the transaction is at the "intercompany" level with transfer pricing. If the other internal organization is not competitive or does not have the right product then they can go to the outside. Sometimes they go to the outside for the entire product and just put the IBM logo on it. But the internal transactions would not typically come under the OEM umbrella. So weakness here does not correlate to weakness in the rest of the IBM hardware business since it is two different markets with different measurement schemes. That said, if IT spending has not recovered and IBM's OEM business is down due to third parties not buying IBM components then the logic stream leads you to believe that the IBM hardware product lines will also be under pressure so I agree with your reasoning.