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To: Eddie Kim who wrote (37626)	4/13/1998 12:54:00 PM
From: jim kelley	Read Replies (1) \| Respond to of 176387

Eddie, It sounds like your position is based on faulty logic supported by a lack of data. please fix this.

To: Eddie Kim who wrote (37626)	4/13/1998 1:02:00 PM
From: SecularBull	Read Replies (1) \| Respond to of 176387

More of CPQ's machines are NOW considered sub-$1,000. They weren't two months ago!

To: Eddie Kim who wrote (37626)	4/13/1998 2:44:00 PM
From: Lee	Respond to of 176387

Eddie,..Re;<<If you follow Compaq you will soon learn that the problem is in the high-end machines.>> I am answering this in an effort to be exactly clear on where CPQ problems lie. Do we differentiate the market into commercial and consumers? Do we assume or know that the consumer market buys mostly the sub $1k PCs? Also do we acknowledge that the commercial market buys the higher end machines? If we make this distinction, then according to CPQ announcements, they are having problems with the higher end machines. biz.yahoo.com Compaq's First Quarter To Be Below Expectations Mar 6 Mason reported that the shortfall was primarily associated with the North American commercial market This is also the product area where price cuts are occurring. biz.yahoo.com cpq announces agressive price cuts on business desktop PCs APr 13 biz.yahoo.com Compaq cuts some server, workstation prices Apr. 8 In my estimation, business desktops as well as server/workstations fall into the commercial/high-end category. Anyone, please verify. Regards, Lee

To: Eddie Kim who wrote (37626)	4/13/1998 6:10:00 PM
From: Chuzzlewit	Read Replies (3) \| Respond to of 176387

Eddie, I believe that Compaq has two distinct problems. The first is one is in the high end market as you say. There, they have bloated inventories of obsolete components and machines. But I believe they have a second problem related to the retail marketplace. Jim Kelley and Meathead have repeatedly documented the razor thin margins that existed on the sub $1,000 machines prior to taking into account the dual profits that the channel must achieve (profit to the distributor and profit to the retailer). TTFN, CTC