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

To: Ian@SI who wrote (112108)	3/25/1999 9:22:00 AM
From: JRI	Read Replies (2) \| Respond to of 176387

Ian- Since last summer, I have registered the idea (not an original one..several others here too) that there is a real possibility (within the next few years) that IBM and HP (and some other small players) could abandon PC manufacturing in part or entirely. It was also my view that this was not (at all) priced into the stocks of Dell and Compaq...the (most likely) two companies to benefit (the most) by the abdication of the other two big guys... It was unclear to me how things would play out (I can't say that I was so smart as to seeing the IBM/Dell deal coming)...but, as it looks now (at least for Dell/IBM), it is starting to look like an even better scenario than I imagined....Under my (former) view, I (simplistically so) saw IBM getting out of some segments of the computer manufacturing business...letting market share up for grabs..of which, Dell would get some.....Now, it appears Dell and IBM are going down a road where Dell may acquire the lion's share, if not all, of IBM's business...what a huge land grab that would be... Certainly, if IBM goes further down this road...in my view, it will make it much easier for HP to do the same....(well, let's put it another way, HP, I'm assuming, would then be under enormous pressure from its shareholders to do the same...) I can't say I know enough to know which parts of the computer biz manufacturing HP and IBM will relinquish (under this scenario)...but it is likely to be significant...even if it is not most or all.... Also, I may be in the minority here, but with the establishment of a virtual duopoley in the corporate PC space (with Compaq and Dell dominating), Dell could benefit from better margins...as a result of less competition in the large corporate market...(although I think Gateway and Micron would get more aggressive in this space, so any potential future advantage could be partially or fully nullified)... Additionally, I am assuming that Dell, as it gains share, gets better breaks on component parts purchases, contributing also to the bottom line... Again, in my view, the issues I've listed are not at all priced into Dell's growth rate or stock price...