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To: jim kelley who wrote (76058)	11/1/1998 3:00:00 PM
From: stak	Read Replies (2) \| Respond to of 176387

Jim, IBM's Gerstner says PC era over >>The history of computers supports the dominance of the general purpose computer. Most people do not like having to have 20 special purpose devices to master when one general purpose device can do it all.<< Yes, history supports this 100%. The PC is the ONLY product that has bucked this general trend. Most people prefer to have devices that do one or two specific things. They don't want an AM/FM microwave oven. Or an AM/FM/CD fax machine .Or a TV with the VCR built in.... Consumer electronics history supports the special purpose model. Sony knows this. They don't make TV's with radio tuners and CD's built in, although it would be a piece of cake if they thought it had any chance of selling. When you have a general purpose machine the ease of use goes up considerably. Trying to use the remote control on some home entertainment systems can be a nightmare. Why? Because there's just too many choices of what the user can do. It's fine if the user only has to press one button and that's it, but, when one has to press many in the correct order then it becomes overwhelming for many. Keeping it simple is best. The PC is simply overwhelming for many folks out there. >>Special purpose products are by their very nature special purpose,i.e., restricted in the applicability to a wide range of applications<< Yup and that what makes them the end all be all. Here's what one fellow thinks about the PC era. He probably has access to each and every product and service that IBM will sell in the next 6-12 months(the time frame when the PC will start to lose its 100.0% dominance). Perhaps more importantly thru NDA's he probably has intimate knowledge of countless other computer industry products that will be intro'd in the very near future. Who knows could it all be hot air. After all the PC owns 100.0% of the market now. History backs this up. ====================================================================== IBM's Gerstner says PC era over By Reuters Special to CNET News.com October 22, 1998, 7:10 p.m. PT Lou Gerstner, chairman and chief executive of International Business Machines, today declared that the era of the personal computer is ending, as the world shifts to a new model of computing. Gerstner, in his fifth year at the helm of the world's largest computer maker, made his comments in an interview with cable television network CNBC. "The era of the PC is over," he said plainly. In its place will be a new model of so-called network computing, Gerstner predicted. While PCs will still sit on nearly every desk, the programs, data, and other information will reside on powerful servers linked by networks. Coupled with the proliferation of the Internet, this new model will allow small companies to function as bigger companies with deeper pockets, and allow large companies to push further into international markets, Gerstner said. Despite global economic turmoil and ruinous economies in much of Asia, IBM on Tuesday reported third-quarter earnings that rose about 7 percent as robust sales in North America more than offset weakness in Asia. Per-share gains were helped, as in past quarters, by aggressive share buybacks while overall profits were paced by a 23 percent increase its services business. Services revenue in fact rose to $5.8 billion, at a far faster pace than the overall services industry. Net income rose to $1.5 billion, or $1.56 a diluted share, from $1.4 billion, or $1.35 a share, surpassing Wall Street profit forecasts for $1.53 a share. "Overall, it was a very good quarter," the 58-year-old told CNBC. Gerstner went to IBM after top-level stints at RJR Nabisco and American Express, and was the first chief executive at IBM not to have come from inside, and up the ranks. Though far from a technologist, he brought to IBM much-needed focus on its customers--something the executive said IBM had lacked. "We had to focus this company maniacally on the customer," Gerstner said. "We eliminated a lot of the internal focus." When Gerstner came to IBM--his first day at Armonk, New York-based company was April Fool's Day 1993--Big Blue was bleeding red ink, having been caught flat-footed first by the shift to minicomputers from mainframe computers, and then by the quick shift to the PC. IBM has grown to revenues of about $80 billion under Gerstner's stewardship, while its stock price has surged (on a split-adjusted basis) more than five-fold to $141.81 from little more than $25 a share when he took over. Earlier this week, the stock touched a record high of $143.69. Even so, IBM has come under criticism in recent quarters by analysts and investors for revenue growth of 3 percent to 5 percent, excluding the effects of currencies. The concern is that IBM can only continue to cut costs and lower its tax rate for so long before profit growth stalls.