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

To: Obewon who wrote (17898)	2/22/1998 5:19:00 PM
From: Jack T. Pearson	Read Replies (2) \| Respond to of 97611

Obewon, In response to your questions: 1) Intel has stated that Merced if for high end systems and that they intend to provide different solutions for other market segments. I believe them. By segmenting the market, they can fend off competitors in any specific segment while maintaining high profits in the other segments. I don't why Compaq would be at any disadvantage to their competitors in any market segment because of Intel pricing. 2) Falling component prices reduce average sales price (ASP). This makes computers less expensive and increases the size of the market. That is good. How does it impact a box-maker's profits? That depends on how much of the cost reduction he passes on to customers, how much the overall market expands, and on how potential customers perceive his product value relative to that of his competitors. IMHO, the biggest factor in the long term strength of companies like Compaq, Dell, HP, and IBM is the perpetual advance of technology. That is why component prices drop. That is why I want to upgrade my software and hardware to take advantage of new capabilities being offered. I can now "pull" audio reports I choose, when I choose from the internet and listen while I work at my computer. Within two years I expect to see a significant improvement in the quality of video clips, maybe entire movies, accessible via the internet. In the near future, I will be able to interact with my PC by voice. Last month I got a cable modem that increased my access speed by more than a factor of 200 from my phone modem. I expect and am willing to upgrade hardware and software every two years to benefit from these advances. What a great industry to invest in! Quality and capability continuously improve, prices continuously fall, markets continuously expand, and customers continuously upgrade! Is this the kind of dialog you were looking for? Jack