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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (44449)	1/24/1999 11:48:00 AM
From: Knighty Tin	Respond to of 132070

YZ, That is called bluffing with the cards you dealt yourself. The low cost pc simply doesn't work in the "more efficient" direct model and none of the direct players have them. Also, the shipping and handling charge looks much larger as a % of total on a cheap machine, as do all the add-ons the direct geeks try to sucker customers into. Therefore, Mikey thinks cheap boxes are not going to last. He is dead wrong. PC prices are dropping to color tv prices and will continue to do so. Yes, there will still be a market for the top end, and Dell will be there, but it will not be the fastest growing market. In many ways, the pc market, like the radio market and the tv market before it, is a victim of its own efficiency and standardization. The cheap pcs do so much that it is hard to justify buying a more expensive box, especially in a business environment. Neither increases productivity much. The pricier ones are certainly not more reliable. It is sort of like, do you buy the Chevy with the Chevy engine or the Cadillac with the Chevy engine? Some opt for Cadillacs, but many more Chevies are sold. BTW, component prices cannot go up much unless the OEMs are willing to pay the price. And they are not, as they are reaching break even or lower levels already. That is why PII pcs are in glut and Cyrix, AMD and Celery pcs are less in oversupply. True, boxmakers have greatly increased the amount of DRAM in box, but, truth be known, it doesn't do much. If DRAM prices increase dramatically, the amount that is unnecessarily put into boxes is what remains static, not pc prices. What sales the boxmakers have are almost totally the result of breaking the $1000 barrier. The more affluent buyers have boxes and now the middle of the middle class has them. If they want to reach even lower into the economy, they have to continue to lower prices. If they don't want to reach down, they are dead meat, longer term. MB