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To: George Dawson who wrote (14883)	3/5/1998 9:41:00 AM
From: Alan Aronoff	Read Replies (1) \| Respond to of 29386

On the subject of server companies... Headline: Digital (NYSE:DEC) defends technologies commitment ====================================================================== By Josephine Ng SINGAPORE, March 5 (Reuters) - Digital Equipment Corp (DEC) on Thursday said it was committed to its technologies, an issue raised by competitors in light of its acquisition by Compaq Computer Corp (NYSE:CPQ). "That DEC is not committed to Unix is not true at all," Darke Sani, managing director of DEC Singapore, told a news conference. He said DEC was not moving away from systems based on its Alpha chips in favour of Intel's (NASDAQ:INTC). Hewlett-Packard (NYSE:HWP) said recently it was waiting in the wings to capture a bigger share of the Unix operating system market while Compaq and DEC were integrating. Compaq said in January it was buying DEC for US$9.6 billion. The deal is expected to go through around mid year after approvals from shareholders and U.S. authorities. "We believe the Unix business from DEC will be impacted. The (Open) VMS server business will be impacted," Lim Chon-Phung, HP's Southeast Asia general manager for enterprise business told Reuters last month. A large number of customers worldwide run their systems on Digital's Unix and OpenVMS operating systems. Lim predicted the merged Compaq-DEC would pay little attention to DEC's Unix business and suggested the future of the Alpha chip was also in doubt. In response, DEC's officials noted two letters to customers by Compaq's president and chief executive officer Eckhard Pfeiffer in February. "Our goal is to deliver the broadest range of enterprise computing solutions in the industry. As I have publicly stated, this means continued investment in Digital's 64-bit technologies including Alpha, Digital Unix and OpenVMS," one letter dated February 19 said. Darke said DEC's Unix platform was already available for use with its 64-bit Alpha systems and would also be ready for Intel's upcoming 64-bit chip called Merced when it was released. "We have already announced our road map for Alpha for the next five years and we want to offer two platforms -- Alpha and Intel up to 64-bit," Darke said. DEC also called on two of its partners, Sequent Computer Systems (NASDAQ:SQNT) and Oracle Corp (NASDAQ:ORCL), to support its case. Ian Miller, Sequent's Asia Pacific vice president, said it was working with DEC to come up with a new operating system based on Sequent's technology and Digital's 64-bit Unix. He said the result would give customers the easiest migration path to Intel's 64-bit architecture. Sequent focuses on server technology based on Intel architecture. Its partnership with DEC was announced in January. "DEC and Sequent both met with Compaq last week to present our joint strategies and the ongoing commitment to the development of DEC Unix with Sequent DYNIX/ptx was endorsed by Compaq," Miller said, and added that further partnership announcements that would be announced in the next few weeks were also blessed by Compaq. Mitchell Hall, DEC's Asia Pacific director of server business, said the company would continue to invest in OpenVMS. But it was not so clear how another form of Unix called SCO Unix embraced by Compaq would fit in, DEC officials said. It was also unclear at this stage how the merger would affect DEC's PC business in terms of future manufacturing and marketing, they said. Darke said customers were more concerned with whether they would continue to get support for existing PC products, which he believed they would. On whether DEC would continue to offer Dell Computer (NASDAQ:DELL) its support services after the merger, Darke said the details were not yet discussed. Dell, a competitor of Compaq, said in response to a Reuters query: "We don't expect any near-term change in the way we provide services...Furthermore, we continuously consider a variety of current and long-term options for service delivery." -- Singapore Newsroom (65) 870-3080; Fax (65) 776-8112 -- Email: singapore.newsroom@reuters.com