[ltp] IBM to sell its PC business

[Dan Christopherson]

Winsley von Spee wrote:

> Am Freitag, den 03.12.2004, 12:10 -0500 schrieb Matt Graham:
> 
> The very very bad point is that companys does not do this for fun. They
> are doing it because they think thats the best way for making money and
> they are spending a lot of money to find out whats the best way to make
> money.

Well, generally speaking, in a competitive market you have to be 
(percieved as) either the cost leader or the high quality supplier. When 
you're a retailer selling a commodity item like PCs, it's hard to make a 
case that your retail 'service' (as distinguished from the products you 
sell) is higher quality than anyone else's retail 'service'. Such 
retailers are then left to fight over who can make money at the lowest 
price. The winner will then be able to increase volume, giving it 
leverage over its suppliers so that it can reduce costs.

The core PC market (not servers or necessarily laptops) is at a point 
where most people won't pay too much for quality - and why should they? 
A machine a family buys right now for their word processing, internet 
surfing and light gaming is already 'obsolete' in technical terms - it 
only needs to last a couple years. Open market pressures have pushed 
prices for these machines down to the 'disposable' range, in comparison 
to the incomes in the target market.

Hard-core gamers are a bit different, but only in as much as being 
willing to pay a lot of money for graphics performance. They're already 
resigned to doing heavy upgrades fairly often and buying new machines at 
frequent intervals. Again, quality is a secondary concern.
> 
> Are there so many dumb people or does I got something wrong ???

Neither. Most people just have different priorities than you. To you 
quality matters most, to many people, it's price. Frankly, I don't think 
IBM's PCs are any higher-quality than anyone elses at the same price 
point. Servers and laptops are a different discussion, because there's 
less commodity parts involved.
> 
> Greetz
>