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

To: gbh who wrote (55569)	4/11/1999 11:08:00 AM
From: Knighty Tin	Read Replies (2) \| Respond to of 132070

Gary, Your note is to Earlie, but I have some ideas. I think Dell going to the channel would be a good move for them if it worked. The problem is, most channel players don't trust Dell. If they put Dell boxes into their customers' operations, next cycle Dell will be calling them directly giving them a better deal than they can get from the resellers. It is the same reason stock brokers never allow folks from New York to talk to their HNW clients. <g> Now, how would the channel get such an idea? Compaq did it to them last quarter. <g> Which is another reason you see so many HP and IBM offerings from the channel today. As to the Dell analyst meeting, it was the most negative I've ever heard from this touty co. They are in deep kimshee. How much weighting to give it? Of that I am not certain. Mikey may just be trying to lower expectations so they can come in better than expected. MB

To: gbh who wrote (55569)	4/12/1999 2:53:00 PM
From: Earlie	Read Replies (1) \| Respond to of 132070

Gary: I'm not sure that I've ever referred to Dell as "pond scum", as I have always maintained that they are the best at BTO, and that my hat was off to them for being marketing wizards (I still think the "direct" model is nutty). My main concern has always been an insane stock price. I don't know whether Dell actually has gone after the resellers in the U.K. (my contacts say they did) or whether Dell's version is accurate ("the resellers came after us"), nor do I care. From my perspective, it is just more evidence of how brutally competitive the whole PC market is. Dell does have some problems. Everybody is now selling direct, there is a full blown glut, pricing is in free fall, and margins are being squeezed and inventory levels are beyond description. That old phrase, "Apart from that, how did you enjoy the play, Mrs. Lincoln?" comes to mind. My own "tracker" for Dell is showing slowing sales growth, and this appears to be accelerating mildly. Mike Dell has been very subdued in his recent comments, compared to the past. He has also stated that his company will give up margins to maintain market share. The share price makes no sense to me in this light and that is why I think the risk/reward ratio favours the shorts . Best, Earlie