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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Doug Fowler who wrote (98472)	2/12/1999 10:08:00 PM
From: BGR	Read Replies (2) \| Respond to of 176387

Doug, 1. The more the price goes down, the more Dell has to sell to make the same money. Using your logic, Dell should give away its PCs for free. Assuming DELL to be a revenue maximizer and not a profit maximizer, of course. An incorrect assumption which makes no business sense IMO. 2. When IBM, Compaq and HP accept lower margins, it forces Dell to accept lower margins. It usually has been the other way as DELL forced lower margins on its competitors by virtue of its superior execution. Even for lowered margins, DELL's margins will remain superior to the 3 that you have mentioned unless they successfully change their business model (no sign of that yet). The 3 companies are profit maximizers as well so it is only a matter of time till they quit. 3. No matter how good Dell's business model, they are limited by the overall demand for PCs. A. DELL has diversified into server and storage and is not in the sole business of selling desktops. B. Worldwide, it will take a while for PC demand to significantly slow down. -BGR.

To: Doug Fowler who wrote (98472)	2/12/1999 10:10:00 PM
From: J Krnjeu	Read Replies (1) \| Respond to of 176387

Mr. Doug Fowler, <<< 1. The more the price goes down, the more Dell has to sell to make the same money. Using your logic, Dell should give away its PCs for free.>>> I'm glad you said that because common sense says if you pay for something, you can not give it away for free and make money off the item given away. I see you really don't understand their business model. <<<3. No matter how good Dell's business model, they are limited by the overall demand for PCs.>>> The demand for PC's is increasing world wide. Thank you JK

To: Doug Fowler who wrote (98472)	2/12/1999 10:47:00 PM
From: Skeeter Bug	Respond to of 176387

doug, pcs are now being given away for free. the big users will be the newbie netizens who don't mind the banners on their desktops.

To: Doug Fowler who wrote (98472)	2/12/1999 11:17:00 PM
From: Brian Malloy	Read Replies (2) \| Respond to of 176387

Another typical unknowing linear thinker. So, in your own words you understand DELL's business model? Then you turn around and say: "When IBM, Compaq and HP accept lower margins, it forces Dell to accept lower margins." This is not necessarily the case my friend for if it was then companies like Word Perfect, Borland, and Lotus would control PC software not MSFT. By the way you have it backwards. Because they are not as efficient companies like IBM, Compaq and HP are accepting lower margins in an attempt to be more competitive with DELL. As far as one of your other weak points. DELL does not just sell PCs they are selling servers. This arm of the business is the fastest growing with large profit margins. Lastly: a. PC & Server sales continue to grow according to Dataquest. b. DELL really doesn't play in the low profit margin under $1,250 PC c. DELL continues to take market share d. DELL is selling more servers Ipso Facto DELL's growth rate is not getting slower. Have a Great Day