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To: Achoo who wrote (51595)	7/16/1998 11:57:00 AM
From: Jim Patterson	Read Replies (2) \| Respond to of 176387

RE: Time will tell if profit margins on service will remain high enough to sustain break-even or money losing PC manufacturing operations. The interesting thing is yesterday I read an article that said CPQ's lowest priced machines are some of their most profitable. Go figure. Just 2 cents worth on CPQ Jim

To: Achoo who wrote (51595)	7/18/1998 10:56:00 PM
From: rudedog	Respond to of 176387

Mark - There's no way to make that kind of service to purchase price return in computers, especially as you move into the high end computing solutions where a server can cost several hundred thousand dollars and up. I beg to differ - this is already reality, not some future trend. service costs are already twice purchase costs in the mainstream, and three times purchase costs in the high end ($100K and up) - IDC has the data, gartner too. The cell phone model could easily work - service staff are a scarce commodity. This would be an interesting squeeze play but not one that the big 3 would resort to unless they were driven to it by market forces IMHO.