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To: Arrow Hd. who wrote (7707)	6/18/2002 5:20:15 AM
From: Elroy	Read Replies (1) \| Respond to of 8218

"There are some real franchises like EMC and Sun that have become really lean so they can perform in this drastically reduced IT environment and when things turn there will be enormous scale in virtually every measurement." I agree with your point, but it's funny you list those two companies. They have implemented the lowest headcount reductions as a % of total of all the major IT hardware companies in the downturn, and that's one of the reasons that they are still in the red whereas CSCO, NTAP, LXK, HPQ, DELL etc. make money. SUN and EMC had their revenues fall about 50% from peak to trough, but cut less than 20% of workforce. Compare that to LU/NT/JDSU which have seen revenue fall about 60% and have both cut over 50% of their workforce. My point is I wouldn't call SUNW or EMC the lean companies at the moment - rather they are choosing to keep expenses high (especially R&D) and invest for the future.