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

To: stock bull who wrote (129309)	5/27/1999 12:33:00 PM
From: D.J.Smyth	Read Replies (2) \| Respond to of 176387

<<don't under estimate Cpq. With the proper leadership, they may come charging back. Look what Steve Jobs did for Apple Computer. (I'm not saying that Apple is a threat to either Cpq or Dell, >> here's one of MD's responses to the Cpq threat (previous statement) "A lot of resellers are struggling right now because their manufacturers are squeezing the margins so hard that there's no way for them to earn a decent profit. so they can't hire and train great people. Because they are squeezed so much by the indirect manufacturers, they can't expand geographically, so they can't compete with us on a global basis. If you take a look around, you'll realize that there's no such a thing as a global reseller. The indirect channel is perpectually playing defense to our offense." (page 212 of his book "Direct From Dell") Remember that Cpq's success is largely dependent on the resllers. If the resellers can't make money relative to Cpq's squeeze, then Cpq must compete on the direct level - a level at which they've performed poorly thus far (in order to keep the resellers happy they charge the same prices through their direct channel as they do through the resale channel). It's a catch 22 for them - can't win at the resale level, hard to compete at the direct level. Remember that Dell offers onsite repair and service - Resellers don't (90% of them).