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

To: Jason W. France who wrote (21781)	3/14/1998 12:45:00 PM
From: ed	Read Replies (2) \| Respond to of 97611

OK, just tell me why the DEC merger will defocus CPQ's exec mang ? Quite on the contrary, the merger will make CPQ more focus, why ? DEC will help CPQ get into the enterprise computing business quick, why , because DEC already hold big customer base in that area, why? look at DEC's annual sales, and revenue? This means from now on CPQ/DEC can more focus on the high profit high margin area. PC business will be low margin high volume in the future. I have asked you what CPQ will be in five years if it did not decide to merger with DEC now ? You have not answer . As to the current CPQ's distributors, they have not help much in the enterprise market at all, so . what conflict you are talking about ? Conflict in the PC market ? DEC is not quite in this market. For transation, CPQ can hold a dual models for the PC market , and then transfer completelt. If all the box makers go to direct sales, then those distributors will not have any choice at all. That is the trend of the market.

To: Jason W. France who wrote (21781)	3/14/1998 1:10:00 PM
From: Loki	Read Replies (3) \| Respond to of 97611

Jason...The reduction in shareholder value... If you measure shareholder value as earnings, the DEC acquisition has diluted this....for now. In each strategy of a corporation the following is considered: From a macro and micro view one can evaluate the life cycle of corporations and also products. <Macro Corp Phases> 1. Introduction (negative, no, or low profits) 2. Growth (profit incline/corporate structure change) 3. Maturity (profit-"cash cow" phase)(corp can become complacent here) 4. Decline (reduction in profit) (Usually due to "me too" product, when competitors realize what made you successful, and copy it) <If a corp. is to survive they repeat cycles> Corporations that adopt new strategies (new introduction phase) during the "maturity" phase (using available profits) and simultaneously move out of the old strategy can balance profits with losses. To continually recognize new opportunities and adjust your strategy is the skill. (What does CPQ history show you?) (Which opportunities to pursue and which not to pursue is equally important) THE DEC ACQUISITION...is the strategy to adapt to a changing market and depart from a market that has reached diminishing returns at a time CPQ is in the corporate "maturity phase". The DEC acquisition presents CPQ with the ability to have a "full package" solution for its customers. IMO-The integration will not be without tremendous hurdles, but CPQ has no choice. Loki