TRADER@cup.portal.com (01/31/88)
Re: Mr. Bass' predictions:
I work in the computer industry at a well-known computer company. A few
observations -
(1) Products that are unprofitable are being quietly dropped with no
publicity. Dealers still have them in inventory - the only difference
is that now, these items aren't in the price list. If you want to hear
people scream, tell them the item is discontinued. We still provide
repair service, but don't expect any new versions of software for the
product - i.e. - bugs will not be fixed, the user will have to live with them.
(2) When items are dropped, they are often made available to employees. I
just picked up some of our hardware at 30% of list price at an employee's
only sale. Ask around and find out if a company is offering equipment to
employees at bargain-basement prices. A good sign of #1 above...
(3) Computer companies are doing a practice associated with the old
Bell telephone system - using exotica to subsidize the more widely
known offerings. For example, we're in a vicious price war with our
"flagship" product. Margins??? What margins??? But, we also make hardware
for markets where we are the dominant player and have little competition -
profits from these items are used to subsidize the "flagship" items.
TRADER@cup.portal.com
TRADER%cup.portal.com@sun.com
(I lease time on the Portal system,
I don't work there.)