Dell hit by downgrade on PC market exposure fears

Brian White — Fri, 06 Feb 2009 16:30:00 EST

Filed under: Analyst Upgrades and Downgrades, Dell (DELL)

J.P. Morgan analyst Mark Moskowitz indicated yesterday that the world's second-largest PC maker -- Dell, Inc. (NASDAQ: DELL) -- would be facing "revenue offsets" due to its high exposure to PC sales in the enterprise (business) sector. While this is not exactly new news, it still rings new. Dell's high exposure to the PC business and its relative weakness in just about any other product industry will hurt its revenue plans this year, and possibly longer.

Why a downgrade now? Moskowitz indicated that 2009 will be a weak and turbulent year for the PC business, and Dell has almost every bit of its exposure in that area. From a market category perspective, the $700 laptop to the $10,000 corporate server -- and everything in between -- will get hit this year. Unlike competitor Hewlett-Packard Corporation (NYSE: HPQ), Dell does not have a division that can subsidize its PC business. Its only business is computers (of all kinds, of course). Moskowitz's ratings downgrade from neutral to underweight underscores this notion.

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Dell hit by downgrade on PC market exposure fears originally appeared on BloggingStocks on Fri, 06 Feb 2009 16:30:00 EST. Please see our terms for use of feeds.

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Dell and Lenovo exchange ad misrepresentation barbs

Brian White — Tue, 24 Jun 2008 11:22:00 EST

Filed under: Competitive Strategy, Apple Inc (AAPL), Dell (DELL), Marketing and Advertising

PC manufacturers never let a moment pass up where they can seemingly one-up the competition by using meaningless marketing claims. The "World's Fastest" and "World's Most Secure" taglines are so hokey that it's amazing we all don't buy PCs at the local flea market. So, when Dell, Inc. (NASDAQ: DELL) recently said that it made the "World's Most Secure Notebooks." Chinese competitor Lenovo had a problem with that. What exactly does that claim mean, anyway?

This isn't the first time for a meaningless claim to be used in PC land. Sure, one of Dell's systems may be the "World Most Secure" in a certain environment with a certain arrangement of software, but to use that implied moniker to describe your entire product line is ridiculous. Apparently, consumers and business decision makers believe these pitches of manufacturers. The funny thing is that it makes sense for all PC manufacturers to use illegitimate claims. Why? Because the PC industry is a commodity one. What else is there to differentiate products?

No matter how much PC company CEOs harp on "we're better at this, we're better at that," it doesn't matter. Almost all PCs are like a gallon of milk; you choose one and you move on. Service options after the sale are the differentiators, not the hardware that was most likely made by one of a handful of Asian contract manufacturers anyway. Even the high-and-mighty Apple, Inc. (NASDAQ: AAPL) has been accused of using claims that sound too good to be true, such as "the world's fastest, most powerful personal computer" -- to which Dell promptly complained.

Dell and Lenovo exchange ad misrepresentation barbs originally appeared on BloggingStocks on Tue, 24 Jun 2008 11:22:00 EST. Please see our terms for use of feeds.

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