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

To: Techie who wrote (26760)	5/29/1998 8:56:00 PM
From: John Koligman	Read Replies (2) \| Respond to of 97611

OK thanks for your input. I would only add that DEC was not exactly a 'marketing machine'. With CPQ behind it, Alpha may surprise many. Guess we will see. John

To: Techie who wrote (26760)	5/30/1998 11:16:00 AM
From: rudedog	Read Replies (1) \| Respond to of 97611

Techie - I think you are overlooking a number of important factors here. 1) HP has a lot at stake with Merced both for their 32 bit and 64 bit plans. Merced delay is not just a narrow segment issue for HP, it delays the whole transition of their PA-RISC architecture, which will fall behind the performance curve. 2) The key to understanding the CPQ puzzle is not Alpha vs Merced, but 32 bit vs 64 bit. MSFT and others are committed to a 64 bit transition for the enterprise market. The ISV (software developer) community NEEDS a 64 bit patform to develop on. Guess what the ONLY option for the next 18 months will be? Now guess which platform will run those 64 bit OS and applications better, and which platform will have more loyalty? The only answer is Alpha. 3) DEC had no significant volume business, so Alpha was always a niche product. CPQ can generate huge volume simply by moving Alpha into some of the volume server lines. CPQ could in a matter of months put Alpha on track for a 5X volume increase. This also allows CPQ to position a true 64 bit product against SUN, both with Unix (SUN does not have a full 64 bit Unix and will not for a while, they were targeting Merced for that product) and also with 64 bit NT. Keep in mind that CPQ has known about the Merced schedule slip for months, and suspected it even before the DEC acquisition. The internal estimates at CPQ were for summer of 2000 and have now moved to 'late' 2000. This would give an aggressive Alpha strategy at least 2 years in the market, with CPQ as the only volume player. It would be naive to assume that the role of a leadership technology product like Alpha in the hands of an aggressive market leader like CPQ will be anything like it was with a weak sister like DEC. I know that MSFT is betting on a big place for Alpha in the new CPQ. If merced slips again it will be Intel playing catchup.