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Technology Stocks : IBM -- Ignore unavailable to you. Want to Upgrade?

To: dav who wrote (4853)	3/25/1999 3:18:00 PM
From: Robert Scott Diver	Read Replies (2) \| Respond to of 8218

Can you explain the difference between IBM selling chips and INTC selling chips? Please also explain the difference between IBM selling disk drives and Seagate selling disk drives. What IBM is doing these days is making money. How IBM is going to become a service company by increasing its high technology business is not clear from your post. You seem to be very negative on IBM, but you post doesn't give any realistic or coherent reasons. Perhaps I am missing something. Scott

To: dav who wrote (4853)	3/26/1999 10:29:00 AM
From: Arrow Hd.	Read Replies (2) \| Respond to of 8218

Dav, the concept behind OEM is based upon the assumption that as a logo'd vendor you will never want to capture 100% of the market due to the price attrition suffered once you go beyond the law of diminishing returns. The remaining market will be captured by your competitors so if you can sell as much as you can to these competitors as a vendor you will now get your share and a piece of their share which is about as much as you can ever expect to get in a competitive market. further, having your competitors rely on you for technology parts creates a dependency that indirectly protects against price wars since as the OEM you control a piece of the cost of goods sold equation and this limits the deep discounting ability of your competition. So the OEM concept plays well when it is true incremental business and not in lieu of your own logo'd products. Hope this helps.