The have regular application software they are good at, but they are not great at video streaming.
At yesterday's meeting, management expressed confidence that operating margins in the computing systems segment should double in six to nine months.
They can split the costs more. It makes sense to divide the cost and share the risk.
The fact that everything is back on the drawing board, with respect to partitioning the printer business, makes the stock more attractive.
In that sense, they were able to deliver more positive news, even though sales into the channel were up only 17 percent while sales out of the channel were up 36 percent. Those numbers should be equal. But with inventory at three weeks, they ought to be able to drive sales more aggressively in the channel.
I think that should set up a very positive picture for the December quarter, subject to execution.
The overriding issue is on getting the channel and distribution model in shape.
There is so much flux there ... I don't see it as a direct challenge to Dell.
Things are bad. They are not the strongest player out there.
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