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Date: Sat, 22 Feb 2003 11:56:42 -0800
From: Larry McVoy <lm@bitmover.com>
To: "Martin J. Bligh" <mbligh@aracnet.com>
Cc: Mark Hahn <hahn@physics.mcmaster.ca>, "David S. Miller" <davem@redhat.com>,
       Larry McVoy <lm@bitmover.com>, linux-kernel@vger.kernel.org
Subject: Re: Minutes from Feb 21 LSE Call
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On Sat, Feb 22, 2003 at 11:42:55AM -0800, Martin J. Bligh wrote:
> >> Dell makes money on many things other than thin-margin PCs.  And lo'
> > 
> > Dell's revenue is 53/29/18% desktop/notebook/server; 
> > 80% of US sales are to businesses.  their annual report doesn't
> > break out service revenue.
> 
> Interesting. Given the profit margins involved, I bet they still
> make more money on servers than desktops and notebooks combined
> (the annual report doesn't seem to list that). And that's before 
> you take account of the "linux weighting" on top of that ...

Err, here's a news flash.  Dell has just one server with more than
4 CPUS and it tops out at 8.  Everything else is clusters.  And they
call any machine that doesn't have a head a server, they have servers
starting $299.  Yeah, that's right, $299.

http://www.dell.com/us/en/bsd/products/series_pedge_servers.htm

How much do you want to bet that more than 95% of their server revenue
comes from 4CPU or less boxes?  I wouldn't be surprised if it is more
like 99.5%.  And you can configure yourself a pretty nice quad xeon box
for $25K.  Yeah, there is some profit in there but nowhere near the huge
margins you are counting on to make your case.
-- 
---
Larry McVoy            	 lm at bitmover.com           http://www.bitmover.com/lm 
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