EDITORIAL - The sour grapes of wrath
It's been a week of PC giants bickering: Dell reported year-end results that met estimates but were down in the fourth quarter, and Compaq seemed to think it would automatically lose market share. However, such channel fairytales rarely come to pass - we're sure of this because we haven't seen any distributors or resellers pirouetting past our offices in pink tutus singing 'Dell is dead, tra-la-la-la-la'.
This was bound to happen, though. When a company as successful as Dell - damn its direct heart - suffers some minor financial indigestion, a non-direct player such as Compaq (sorry, that's not strictly true anymore, is it?) has a go.
In journalistic terms, it's called 'spoiling'. That is, whenever a company is about to come out with something - either products or good figures - rivals queue up wondering what controversial statements they can make to the press to deflect some of the publicity onto them. In business terms, the same practice is usually referred to as sour grapes.
Let's put things in perspective.
Compaq is top of the heap and is far more concerned about Dell than it is with IBM in the PC war, despite IBM being next in line. Why? Because Dell represents a whole new business model which threatens the entire foundation of its sales structure, the entire channel structure and the universe as we know it. So, any opportunity for a dig is taken. But take it all with a pinch of salt as there are some facts that should be aired before you go rummaging for that celebratory tutu.
Despite sluggish US growth, Dell is growing at more than three-and-a-half times more than the market and its European business rocketed 40 per cent in 1998. In addition, Dataquest's latest worldwide PC market share figures show that far from losing its share, Dell closed in on IBM with a 65 per cent hike in growth. This puts it just 0.3 per cent behind IBM in the number two slot. So much for troubles ahead.
Troubles are ahead, though, for one software giant. Whatever happens about the DoJ trial, Microsoft could be facing an even bigger threat.
From - that's right - marauding Linux users.
Twenty Linux users and 100 supporters from California went to the Microsoft building last week for Windows Refund Day, where they wanted their refund for software they had to take with their new PCs, but which they never used.
Despite been told that the office would be open, the group suddenly found that the doors of the elevator would not work when they got to the offices on the ninth floor (it was obviously still waiting for the next NT upgrade). Still, they had the last laugh by staging their protest in the car park of an adjacent building, standing in front of a Microsoft sign that read: 'Microsoft welcomes the Linux community.' Just not on its doorstep.
DEALER BUSINESS: YOUR COMPANY'S PROBLEMS SOLVED
The foundations upon which a successful dealership thrives are multi-fold. From structuring and marketing the business, through to employing and retaining staff, the daily juggling act of running a profitable organisation can be a precarious one.
Margins are being squeezed, vendors are pushing more business through ever-broadening channels and a shortage of skilled staff threaten all but the most structurally solid of firms.
To help dealers tackle the problems of running a business, PC Dealer is kicking off a 12-part series dedicated to solving a variety of business issues. The first article looks at how dealers can finance their organisation and effectively manage cashflow. See page 44.