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Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: cheryl williamson who wrote (8040)	3/5/1998 7:44:00 PM
From: Uncle Frank	Read Replies (3) \| Respond to of 64865

>>So, it's really the sub-$1000 PC that is causing INTC's current difficulties. And, we all know that the advent of the NC is creating the market for sub-$1000 PC's. Cheryl, I've heard a lot about about NCs as a concept, but didn't think they had established a tangible consumer market. Are you sure they're advented yet? IMHO, Intel has been forced to offer processors to support sub-1K systems in order to combat AMD and others who are trying to get a toehold through low end PCs, not NCs. But I don't think that's the real issue today. Based on the releases I've seen, Intel's 1Q problem relates to a volume shortfall rather than mix. This is probably due to good inventory management by the box makers following the 4Q boom, since PC sales are so seasonal. Also, Compaq and others are heading toward the Dell paradigm of build to backlog, which puts another brake on inventory. It would nice to think that Sun's thin client is having such a huge impact on the pc world, but I don't think that's the case just yet. Frank

To: cheryl williamson who wrote (8040)	3/5/1998 9:42:00 PM
From: Carl Wysocki	Read Replies (2) \| Respond to of 64865

Cheryl, I believe the NC and the Sub $1k PC are entirely different markets, and won't have any cross impacts for quite some time. The NC is really geared to the business market, and moreso to application specific tasks. You really don't want a travel agent playing games, writing a resume, or surfing the net, so the NC goes a long way towards reducing TCO by eliminating all the distractions to employee productivity. Plus, it's optimized for that particular task. The low end PC, at least for now, is more a consumer item, although there is really no reason most companies couldn't provide one of these to (my guess) 90% of their employees without any loss of productivity. But, the resolution of this issue may be more cultural than economic. The value for Sun of the thin client is not the thin client itself, but (I hope, I hope, I hope) future royalty/licensing income from the software, as well as the demand for enterprise level servers. Plus, Sun would have to become a low cost provider of thin client hardware, which is not really its core competency. If I'm not mistaken, Scott always alludes to the server drag as the source of profits, as opposed to the thin client or software (because of the large re-investments in Java). I'm bullish on Sun. I just don't think the NC and sub $1k PC are competing for the same customers. And, on to your next post, yeah the ad campaign isn't the best, but it sure beats that damned dog. One of these days I'll have to tell you about a tasteless T-shirt I have, but at the moment, I can't remember what it says, and Sun may pay good money to buy it back. Carl