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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: John Koligman who wrote (80214)	4/28/1999 3:11:00 PM
From: Mary Cluney	Read Replies (4) \| Respond to of 186894

John, >>>do you think a Fortune 500 CIO is going to 'bet the company' by unplugging his S/390 complex and putting his/her data on Intel based servers<<< Some of these Fortune 500 companies have invested, over the years, more than 10,000 man years or over $1B dollars in applications software development on mainframe platforms. So, needless to say, it would be unwise, if not impossible to unplug these s/390 complexes. My guess, though, is that very few of these companies are very happy with their IT expenditures. Some of these companies have to spend several hundred million dollars a year just to keep these computers running and functionally standing still. Unfortunately for these Fortune 500 companies, the CIOs that get to keep their jobs are those that lay low and make few waves. What the Fortune 500 companies should do is to freeze any new developments on the mainframe. Keep those dinosaurs running and trim excess fat. Any new development is done on a more modern and more cost effective platform. IA64 is coming and it will dominate. No use fighting it - might as well get on board - sooner is better than later. Mary

To: John Koligman who wrote (80214)	4/28/1999 3:25:00 PM
From: Mary Cluney	Read Replies (4) \| Respond to of 186894

John, >>>I found it interesting that Intel wants in on the server farm business.... Intel in services??? Why would they do that??? <<< The terrific thing about the services business is that it cost so little to get into it and is hugely profitable. The bad thing about the services business is that it cost so little to get into it and is hugely profitable. Nowadays, almost any two people (with or without a dog) can get into the services business and compete with the major players. In many cases the bigger players do not have any advantage. In fact they are frequently disadvantaged by a high cost structure. So, if you are working for IBM and nearing retirement, instead of getting kicked out because you are getting "too old:, you take early retirement and you take with you some accounts that you have been working on for the last few years - and go out on your own. Instead of making $100,000 a year at IBM, you could make $250,000 a year for a couple of years and cushion your retirement. The "server farm" business is something a little different. You need $50 to $100 million dollars to get into the business. I guess that could be a barrier for some - maybe not for Paul - but for others it could be an insurmountable hurdle. Mary