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Technology Stocks : (LVLT) - Level 3 Communications -- Ignore unavailable to you. Want to Upgrade?

To: Ajay who wrote (791)	4/8/1998 10:49:00 AM
From: SecularBull	Respond to of 3873

Ajay, I think that DELL can maintain margins moving forward. You have to keep in mind that for the competition to hurt DELL they will have to, in fact, cannibalize themselves, because of the greater efficiencies of DELL's direct model makes it difficult (impossible) for the indirects to undercut DELL. This is an untenable position for them. I think that's why CPQ has begun to mold itself as another IBM (see Tandem and DEC), rather than just a PC firm. It can't compete in the PC market TO THE EXTENT that is required for them to maintain the needed market share. Therefore, they a relying on other enterprises. The mistake here is that all of this overhead drains their margins even further. DELL "partners" with other companies to achieve the same synergies without the added overhead. Let me know if you have any other questions. I'm happy to chat about it. LoD