How much of an opportunity is the retail market now? With the sale of Byte, Specialist Computer Holdings (SCH) has signalled the last retreat from the sector by the traditional computer reseller business. And it's a good thing too, from SCH's point of view. It can now concentrate all its efforts on the matter of growing the corporate business. With Mike Lunch at the helm, and a bigger-than-ever services operation in place, SCH will be a company to watch in the next few months.
New battle lines are being drawn in the corporate dealer market. With Computacenter headed for the stock market and Pan-European expansion, and GE Capital looking in that direction, there is a new set of parameters. Smaller corporate business is not so attractive for the really big players.
Back to Byte. The sale provides Dixons Group with almost the entire retail market. Now whether this is a good thing for the consumer or not, I don't know. It certainly shows us that, no matter how hard you try, UK computer dealers can't make the retail model work. The costs are just too high.
It is a shame to see Byte go to Dixons - we can expect it to get diluted and gradually washed into the PC World format in most places. It was an excellent concept and looked great, but I suspect it never made much for SCH and that, in the end, is what counts.
The retail market is left to Dixons, a handful of other electrical chains and a few independents. So what happened to the retail boom? Why hasn't it clicked like it has in the US where the market is expected to increase from the current 12 million units a year to 17.5 million by 2002, according to Forrester Research?
It's simple really. Buying a PC in a shop is not something that British SMEs and consumers like to do. Even if it does cost only #600. They seem to like the idea of buying direct or off the page a lot more.
So that could be good news for the likes of Dell. Or is it? Compaq, IBM and HP - all developing in the business channel - are not going to leave the retail market alone and have volume production to address that market.
Nor are Gateway2000 and NEC/Packard Bell. And then there are the home-grown producers to contend with.
Dell has a low-cost model, but if the company grows more in the consumer sector, it may affect its performance in the business market. It clearly needs to find a new maintenance supplier - surely Digital can't go on doing that job as part of Compaq? Wang is believed to be the front runner for this job and the deal with Olsy will help its case.
But Dell still has a service issue to address for the business market. I still think only a merger or takeover will satisfy the corporate market. Otherwise Dell is getting close to the ceiling.
Although volumes are rising, prices are falling. The high margin business is, as ever, in the high end of the market.
Simon Meredith is a freelance IT journalist.
Chief exec Jens Montanana claims Logicalis performed well despite 'currency headwinds'
All the photos from last night's event, which saw over 600 people congregate at the Hilton London Bankside
Five year deal with Essex NHS Trust will cover 400 sites, including hospitals, clinics and GP practices
18 individuals and three companies walked away as winners at CRN's inaugural Women in Channel Awards last night