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

To: Jim McMannis who wrote (59711)	4/23/1999 5:07:00 PM
From: rudedog	Read Replies (2) \| Respond to of 97611

Jim - You need to alter your thinking a little , but I like the idea of giving the classic CPQ server division a lot more autonomy. First,re: something has to be done to stem the Dell onslaught DELL has not been as successful as they had hoped in hitting CPQ's server business. CPQ servers exceeded plan in 1998 and again in 1Q 1999. Take a good look at the IDC and Dataquest numbers. I don't think CPQ has to do anything different to maintain and build their absolutely dominant hold on the Intel-based server market. CPQ's servers (the ISSD division which is the old CPQ server division) and commercial desktops are exclusively Intel based. They receive more Intel co-marketing funds than anyone else in the industry. This division used to supply 60% of CPQ's profits according to the people I spoke with yesterday. CPQ should do whatever it takes to assure that this group can continue to innovate and that their resource base is adequate so that they don't get hamstrung. But they are the best in the business, and have been since they invented the idea of intel-based servers in 1989. Likewise they have held the #1 position in that market for 10 years, and there are no signs that they are in danger of losing that top slot.