Mar (03-02) - Slowdown taking its toll

Editorial 03-06-02
March 2002

Equipment specials:

Given the number of Chapter 11 bankruptcies in the user community and the disappearance of some of the more marginal dealers in the third party, many of the rest of us are beginning a retrenchment posture. Many dealers have been left holding the bag as the number of delinquent and non-paying clients grow. We all work very hard and the prospect of having to write off bad debt is horrible.

Inventories continue to be worked down. Lexmark recently cut out its dealer parts arrangement with all but the most brave who were willing to commit to huge quantity purchases....Ever since Omnitech went broke and left Lexmark high and dry, it's unclear who while handle Lexmark's trade-in program.... Rumor has it that there is a large package of Optra S 1855's coming out. They were so tight for so long that it's strange that they may become abundant. Meanwhile, Optra S1650's have disappeared from market, although 1620's and 1625's are still around. We suppose that whomever had been buying up all the 1855's switched to 1650's....I have also heard that there is a company that has learned how to refill Lexmark toner cartridges.....IBM 6262's seem to be tightening again... Thousands of Inkjet printers have been invading the market lately, some new in box....

The thin-client market has been narrowed recently, as buyouts and exits consolidate the field. IBM, Wyse, Neoware, and CLI seem to be the strongest players....Oddly enough, Wyse is offering a trade in against their older thin clients and competitors thin-clients instead of incenting replacement of the real target: PC's....

The installed base of IBM control units (3174, 3274, 5394, 5494) for coax and twinax gear is slow to come out. There have been some large packages of gear being surplused, but most is still solid. Most of the installed base has fully depreciated the assets attached to them and has little motivation (nor capital) to consider replacing it all as LAN/WAN gear. Those firms wishing to convert to TCP/IP have several choices worthy of consideration:

IBM 4317 (NP17)
IBM 3912
IBM 3112
IBM 4303
Lexmark 4049
Lexmark Optra T612vn
Lexmark Optra Sc1275

IBM 6252
IBM 4230

IBM 4320 (NP20)
IBM 3116
IBM 6400
IBM 3916
IBM 4247
IBM 4230-4xx, -5xx
IBM features for 4332-001, -004 (NP32, NP40_
Lexmark Optra S1650
Optra T (whole family)

IBM 4322 (IP21)