Conference 7.286::digital

    My concern is how will we, Digital senior management, react to Q3.  If
    we break even, make a little or even just lose a little that should be
    OK but if we lose more than a little will be just go through another
    round of cutting people.  I am gettin worried that the solution to our
    problem is always to cut people.  
    
    Lets hope Q3 will be different and positive for all of us!

    From a collections standpoint, the push is CASH CASH CASH....
    
    From a sales perspective, the push is REVENUE REVENUE REVENUE....
    
    I've heard "IT DON'T LOOK GOOD!!!", but nobody will put an amount on
    the possible shortfall....		
    
    re: -.1, I think you're right.... the solution to a "bad" quarter will
    be "chop, chop, chop", and quite frankly, in the field, if we lose any
    more, we absolutely will no longer be profitable.... Not to mention the
    customer DISSATISFACTION that we have currently going straight down to
    tubes (further)...
    
    Just mine..........JPs

    Rumors in the field about Q3 have been very negative, with the 
    expectation of more cuts/downsizing to come as a result of a bad
    quarter. We are already being downsized to the point of insufficient
    space to effectively do what is necessary to function as a "customer
    orientated" organization. How much further can it go, before we start
    looking for a little space in a mill to start over? 
    
    It has to stop somewhere, doesn't it? 
    
    Bob 

    Don't know if this is related to Q3 results, but heard a rumor from a
    contractor incidently that we would be comming down to 40K employess.
    Take that for whats its worth.
    
    I'm convinced in the new Digital you will either be a VP or a
    contractor.

    What impact will the declining dollar have on Q3? 

    
    favorable on revenues from europe, asia, spr and japan.
    unfavorable on revenues from canada, mexico and south america.
    
    hedging is also done to offset currency fluctuations. so real
    impact may be minor.

    
          jeez, I hate feeling like a passenger on the Titanic.

    Would you like a deck chair, sir?  Several have just recently become
    available...

RE -2
    
>       jeez, I hate feeling like a passenger on the Titanic.
        ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
	" We just stopped to take on some ice.
	  We are still on schedule so sit back, listen to the
	  band, and remember you are in good hands on a state
	  of the art ship."

    
    	...with more available every passing day. Why just last week...
    
    
    		the Greyhawk (with some apologies to Tex ;-))
    
    

    No apologies necessary.  I liked -.2.  He shoulda added...
    
    "...it took us time to get in the condition we're in and it's going
    to take us time to get back out.  The captain is taking remedial
    action in an effort to reduce excess weight.  To this end, 1/3 of the
    crew has been let go and 37 vice-captains have been appointed to
    supervise the remaining 2/3s.  The top 100 passengers have been
    identified and we will be focusing on their safety.  To raise capital,
    we are selling our bilge pumps (no longer a core competency) to a
    passing ship.  Please enjoy whatever's left of your cruise."
    
    								Tex :^]

    I'm not too sure of the exact facts, but it appears that the Titanic had
    boiler trouble. Rather than fix the boiler or take a slow easy ride
    across the Atlantic, the board appointed a director to the vessel to 
    oversee the maiden voyage. Against the advice of the captain, the
    director ordered the remaining boilers be pushed to the limit and that
    the Titantic should proceed full speed across the Atlantic, and damn
    the ice bergs. There is a suggestion that one or more of the boilers   
    exploded.
    
    Angus

    Re .12
    
    Not the boiler, but a fire in one of the coal bunkers.  These were
    fairly common, but could cause problems if the bunker was emptied too
    far and there was a lot of dust.  Then you could get a tremendous
    explosion.
    
    Bruce Ismay, a director of the White Star line, was on board.  He was
    advised of the fire and the iceberg risk, but would not allow a
    reduction in speed.  He wanted to reach NY in the shortest possible
    time, which meant maximum speed on the shortest route, right through
    the iceberg area south of Greenland.

    
    	"I rang for ice, but this is ridiculous!"
    
    	Can't remember the source of the quote...

��  <<< Note 3742.12 by SUBURB::MCDONALDA "Shockwave Rider comfortably numb" >>>
��                        -< The familiarity goes deeper >-

��    the Titantic should proceed full speed across the Atlantic, and damn
��    the ice bergs. There is a suggestion that one or more of the boilers   
��    exploded.

    Fewer than 10% of the folks on the bridge were women.

    RE .15 - fewer than 10% were women
    
    If todays Navy is an example--all the women were most likely on
    maternity leave.

    Don't even *start* that up again, Wilson!  Bad Wilson!  Bad, BAD
    Wilson!  No donuts, no coffee, go back to your cube.

    
    Nigel, I thought the idea was to use up the coal as quckly as possible
    from the bunker(s) which was/were burning, to try to control the fire.
    The last program I saw on this - a couple of weeks back - dis-counted
    the explosion thoery, the rupture in the ships side which appeared to
    be from an explosion was thought to have been caused by the impact with
    the sea bed.
    
    Graham
    
    BTW, the Captain of the Titanic, was from a town a few miles from my
    home (Hanley, Stoke-on-trent, Staffs), following the inquest in the US
    where he was blamed, the town dis-owned him completely - and a statue
    commemorating him as the Titantic's Captain was erected in Lichfield -
    his family's home ? - instead. Then a few years back when all of
    this evidence came to light he got a sort of pardon, I believe Hanley &
    Lichfield are now arguing over who should have the statue !
    
    Graham

    
    40k population.
    
    Unisys (old Univac/Burlington). They have around 52k pop.and around
    a 5-6 billion dollar company. They have been in the black each qtr.
    for quite awhile.
    
    So we are 14bil (maybe it's smaller now) and we have 60k and can't
    make a dime.
    
    So......if we knew the problem we could fix it. I don't think we
    know the problem. 
    
    downer.
    
    
    

    re: last few regarding Titanic disaster and causes....new data!
    
    A recent Popular Science issue had a very interesting analysis of a
    piece of plate steel from the lower hull area of the Titanic, which was
    picked up during one of the recent surveys of the wreck (Russian 'Mir'
    and IMAX session?). This sample, which interestingly was from along the
    junction of two plates, including a few extant rivets, was subjected to
    the most modern metallurgical and atomic analysis, and the data thus
    gained indicated that the steel was excessively 'brittle', even for
    the standards of its day, due to an excess quantity of sulfur, etc.
    (not being a chemist, I forget all of the other contaminants). The net
    result of this was the hull plates were excessively 'brittle', and 
    when subjected to the extremely cold water temperatures of the North
    Atlantic, had virtually none of the elasticity which a proper grade of
    steel SHOULD have had. 
    
    The net result, when combined with the speed of the Titanic, was to
    cause a massive 'failure' along the contact point of the hull and the
    iceberg, with hull plates 'shattering' and riveted junctions failing
    quite catastrophically. Given also the design problems with the water
    tight compartments, the amount of hull failure in that area certainly
    doomed the ship, and accounted for the very large volume of water that
    came into the ship, which sank quite quickly.
    
    Certainly Captain Smith and White Star were negligent in maintaining
    such speed in a known iceberg zone, but hubris regarding the
    'unsinkable' nature of the Titanic also played a role - a sad
    commentary on the Victorian view of technology/science and man's
    mastery of nature. Bruce Ismay may have had some knowledge of this
    steel issue....but we'll never know.
    
    Unfortunately, given the breakup of the ship into two pieces, and the
    impact of the bow/midsection into the bottom at high speed, there is no
    way (at present) to examine the forward lower hull, which was certainly
    distorted by the impact, to further prove this hypothesis.
    
    I'll find the reference for this article, and will post, for those 
    interested.
    
    The U.S.S. Maine, which exploded in Havana, Cuba, may have been the 
    victim of a coal-bunker dust explosion....several interesting books
    have been written about that disaster, with some corroborating data.
    Coal bunker dust explosions and spontaneous combustion problems in
    bunkers was a very well known problem in the U.S. Navy at the turn
    of the century....check the U.S. Naval 'Proceedings' and publications
    of the day for commentary.
                              

    
>          jeez, I hate feeling like a passenger on the Titanic.

>>    Would you like a deck chair, sir?  Several have just recently become
>>    available...

>>>	" We just stopped to take on some ice.
>>>	  We are still on schedule so sit back, listen to the
>>>	  band, and remember you are in good hands on a state
>>>	  of the art ship."

Nearer, my God, to Thee...

(I have the text of the verses, but that might be too much.)


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Last one for today.  :-)

    
    sidebar to the Titanic's brittle hull plates - several Victory ships
    broke in half during WWII due to embrittlement. This after a couple of
    decades of perfecting the metallurgy and production techniques of
    rolling out plate and fabrication..
    

    re. 20
    
    Unisys just reported a loss in Q4 (Oct.-Dec.) of $52.3 million and
    announced that they would layoff 4,000 more people.  Also, their revenue
    has shrunk from a peak of $10.2 billion in 1987 to $7.4 billion in
    1994.  In addition, their stock has fallen from a five-year peak of
    $16.50 a share twelve months ago to around $9.00 a share today (a 48%
    drop in one year). 
    
    This is not a company that I want to emulate.
    
    They have no RISC technology.  They have four different hardware
    product lines (2200, A-Series, CTOS and U-6000).  They offer three
    different UNIX operating systems (SVR4, Unixware, DYNIX/ptx).  They are
    not price competitive.  They offer very, very few third party products.
    
    Yes, until recently they have made money for about 12 consecutive
    quarters, but they did it through cost cutting.  Their revenue
    continues to fall at a steady pace.  They have a bleak future.
    
    Digital on the other hand:
    
    1. Has excellent RISC technology
    2. Has only one product line for the future, Alpha.
    3. Digital had 4% revenue growth in Q1 and 7% revenue growth in Q2 (an
       upward trend)
    4. Digital has price/performance leadership
    5. Digital offers a lot of third party products (and growing)
    
    Digital has a future.  Unisys does not.
    

>    3. Digital had 4% revenue growth in Q1 and 7% revenue growth in Q2 (an
>       upward trend)

Two points make a line; three points proves it.

    I believe the main customer of Unisys systems is government, isn't it?
    
    Draw your own conclusions...

    While you can look at 2 points of revenue for trends, you can also
    look at the last two years in terms of profit...
    
    Digital lost $92.3 million in 1993
    Digital lost $ 2.1 billion in 1994

    Adding to -.25 note:
    See note s #3539.  Let's add point #6 to your argument why Digital will
    make it and Unisys won't"
    
    	6.  We have 5 1/2 times more VP's per employee now than in 1988. 
    We have up to 5 levels of "nested" VP's reporting to each other.  All
    of these valuable executives are doing wondrous things to assist in
    Digital's rebound, I'm sure.  ("Everything is beautiful....."
    

    
    re. .25
    
    well even my friends at Unisys know their company has no growth.
    
    I was just trying to figure on that rumor of us going to 40k
    population and just how many more will lose their jobs.And
    how things are suppose work, when it doesn't work well right 
    now.
    
    I didn't mean to imply the Unisys was great. I happened to
    work at Univac years ago, which seems like ages ago.
    
    Dave
    

    RE: Unisys
    
    This is curious,  Unisys is running ads in SC, looking for FEs'.
    
    Go Figure.....
    

re Note 3742.25 by MIMS::SANDERS_J:

>     2. Has only one product line for the future, Alpha.
  
        Don't we do some Intel-based PC stuff, too?  (which I'm sure
        will track wherever the industry goes for processors, which
        might not be Alpha)

        Bob

	Just got my Business Week today (3/27 issue). This issue 
headlines America's (1000) Most Valuable Companies.

	Digital is rated 199 in "Market Value"


	Digital is ranked 59 in "Sales" - Not bad


	Digital is ranked 211 in "Assets" - Not bad


	But


	Digital is ranked 1000 in "Profits" - Last, Last, Last 


	That's out of 1000 !! Where's our beef ?? Over-head/VPs is
my guess.

    In the future,you will either be a VP or a subcontractor(somebody said
    it here but I forget who).
    So what?If we were all VPs then there would be some other level of
    management we would blame.The issue is simple-we can't decide anything
    and make it work.The perennial disease is that this months organisation
    is a signal to start looking at the next-no more complicated than that.
    The issue may be simple but making headway is impossible as long as
    there is no stability of organisation.The reason is quite simple too-we
    have no leadership which has yet succeeded in imbuing everyone with
    the same company vision-ie the same articulated idea of a future state.
    Different visions = different organisations(not rocket science)
    Yes we have lots of client/server,partners,alpha etc etc but little
    clear common statement of what will Digitals and hence speakers added
    value be in the future.
    Think about it-what is your perennial added value?

    --------------------------------------------------------------------------------
    Note 3742.26                    How's Q3 looking?                      
    26 of 35
    TOKNOW::METCALFE "Eschew Obfuscatory Monikers"        4 lines 
    17-MAR-1995 14:46
    --------------------------------------------------------------------------------
    >    3. Digital had 4% revenue growth in Q1 and 7% revenue growth in Q2
    (an
    >       upward trend)
    
    Two points make a line; three points proves it.
     End of note 
    ===========================================================================
    
    	A scientist needs three points to draw a curve
    
    	An Engineer needs two
    
    	Marketing needs one
    
    	Sales only needs the belief that there ought to be a curve.  ;^] 
    

    How can the BoD declare a dividend on the preferred stock if things
    are looking so badly?
    
    Sue

     I like concrete examples of what is wrong. I see them listed among the
    chatter here and wish to contribute my own example.
     The CSD Sales and Marketing Guide for SBU/ABU has been released. This
    is the blueprint for this quarters reorg. I read it.
     For both the SBU and ABU there will be a Customer Order
    Management(SBU) and Customer Administration(ABU). These organizations
    are to keep track of customers, orders, exceptions and general tracking
    of sales and delivery in accounts. Why two redundant groups? Because
    the current organization does not work. Is the solution to fix the
    problem? No someone decides to duplicate it.
     So who is help accountable for the failure of a most basic and
    valuable organization? I haven't heard of any focus at all. The
    evidence says that the way to treat the whole thing is to "status quo".
     Who can repair this> Why the army of senior management. But isn't it
    more fun to make a new plan than to address the old problems? Do you
    advance quicker with a snappy new plan or from slogging away in the
    trenches fixing something? 
     If you are a VP and just can't figure out why so many people seem to
    be out for your hide, this is just one example. Us IC's can work
    evenings and weekends, we can call customers and try over and over to
    hold things together. What we can't do is fix these glaring problems
    that not only stand in the way of Digital's success but make our jobs
    harder.
     Is there any way anyone can defend our antiquated and failing internal
    business systems. Is there an excuse for a Major computer company to
    have such a problem? Better yet, what frustates the most that since
    this has gone on for so long, does anyone in the Ivory Towers care?

I hear the 40000 employee number floating around quite a bit.  Where did that
come from, or this another case of Digital employees worrying about some
headcount number because of some unconfirmed Q3 results?  From where I sit
20000 fewer employees cannot happen without selling off major parts of the
company.  There just aren't enough of us left in the field to do the job.

Peter

re Note 3742.37 by SHRCTR::SCHILTON:

>     How can the BoD declare a dividend on the preferred stock if things
>     are looking so badly?
  
        Somebody will correct me (since I'm surely wrong in some
        detail) but preferred stock is more like a bond than common
        stock in some ways, and a dividend (sort of like interest) is
        expected if the value is to be maintained.

        Bob

    That is a good explanation of a preferred stock dividend.  To NOT pay
    the dividend would be similiar to defaulting on a loan with the bank,
    not a good idea.

Unisys doesn't do much business with the Government any longer.   They
were barred from a large part of it due to an ethics error and they
sold off the business units that did most of that business as well.

They have been using the same "cut until profit" model in their systems
division, but, have experienced respectable growth in their supplies, 
networks, and PC product lines.  They are using a very LEAN business model
with very flat management in that division.  The telesales organization
is growing carefully to try to keep up with demand.  They are hiring 
engineers to support the telesales and end sales reps.

Their equivalent to "DECathlon" or "Circle of Excellence" is called "Club."
This February, at Acapulco, during gala evening, everyone waited for the
traditional announcement of next year's Club Event.  There was nothing.

I believe that Unisys and Digital are in similar straights -- the main 
difference, I believe, is that Unisys is trying to rebuild in select
areas NOW.  I don't see evidence that we are.

Bill A.

    
    Hey - I understand it's off to BALI for the upcoming
    Decathlon. I fully appreciate that incentives are needed, but
    to Bali?! Unless everybody is going to stay in locally run beachfront
    huts or stay with Balinese families, how does one account for the
    HUGE $$$$$ to afford the resorts, travel etc????
    
    In my field days, the sales support Decathlon equivalent was a 
    much resented popularity contest - it wasn't how well one did, but
    who basically who liked you. That's changed, right?
    
    
    

    I'd say it has changed.  To a large degree.  I KNOW last year I did
    very well and kinda expected to go, but didn't.  You needed to get past
    a VERY high gate to make it.  Something like 250% of your number.
    
    I didn't look for it, but in the past, when I didn't look for it, it
    was OBVIOUS that political appointees were going big time, and I didn't
    see any last year.
    
    As for BALI, wonderful.  Frankly, with the numbers as high as there
    were this year, anyone who does a 250% performance certainly deserves
    it.
    
    

    Oh man, don't start this discussion, PLEASE.
    
    For one, remember it's 250% of your budget, which could be 250% of a
    dollar, if you've sucked up to the right people.  And don't forget
    shadow booking credit...
    
    Please do not continue this particular line of discussion.
    
    JP

    Please yourself.  NO ONE, repeat, NO ONE that works near me in sales
    has a small budget.  Politics doesn't play now, either.  Home program
    makes it hard to bring coffee to the boss...  Incentive pay has a way
    of focusing a managers attention on his paycheck and therefore on what
    makes it grow or shrink.  "Yeah, you are a great suck up, but I need
    that 30%!.....YOUR FIRED!"
    
    No, it is not gone completely, but certainly things are very different.

    But please explain, if you forecast you are going to make $XX, and you
    make $2.5XX how that help manufacturing know how much product to make?
    Doesn't that encourage "sandbagging" where ever possible.  I'd rather
    reward the folks with agressive budgets that make 100-105% of budget.
    Then they did both ends of their job correctly.  Or are numbers just
    handed to you and you do not do a forecast??

    Yes, I know of several high level engineering managers that don't
    like to see engineering groups come in on schedule all the time.
    They suspect sandbagging.  They want to see us be over schedule
    from time to time to show that we've made agressive schedules.
    
    Now, of course, since I know what they are looking for, I can
    certainly plan on being behind schedule from time to time...
    
    It just goes to show that any metric can be circumvented...
    
    				-John

    there is no input from the rep as to what his budget (quota) will be. 
    none.  not in my neck of the woods anyway.  we are told.  AND this year
    were were told some very large numbers.  top down.
    
    last year I finished at 185% (did not qualify for DECathelon) and my
    management raised my number accordingly. (more then doubled)
    
    No way I'll be able to 185% again.  But, if I work OVERTIME (not that I
    get paid for overtime), I can probably squeeze out 130%+

    So let me see if I understand this string. There was this big boat that
    may have had brittle plates in its hull and a fire in its bins racing
    through ice filled waters. It was filled with Univac guys and Digital VPs 
    on their way to Bali and was getting ready to jettison 20,000
    passengers to lighten the load. We're pretty sure that there were no
    women on the bridge at the time of the incident and we've established
    that the workers had no input into their work assignments and received
    little in the way of rewards. There was an undercurrent of quarterly
    financial dealings and discussion esoteric stock deatils. 
    
    Hey, this is the stuff of a TV mini-series. Maybe the Twin Peaks crew
    is available.
    
    -OFWAMI-

    > passengers to lighten the load. We're pretty sure that there were no
    > women on the bridge at the time of the incident and we've established
    
    No, we're pretty sure that whatever women were on the bridge were NOT
    wearing bikinis; though some of the men might have been..
    
    ...tom

    .50 sums it up pretty well and maybe here is another clue as to what
    is wrong with this company: Someone asks how Q3 is going and look 
    at the answers he gets.
    
    Al
    

��     <<< Note 3742.51 by TEKVAX::KOPEC "we're gonna need another Timmy!" >>>
��                         -< did you testify that...? >-

��    wearing bikinis; though some of the men might have been..
    ...along with frumpy hats.

    I suppose the punch line to all this is still:

    The one guy has to row a lot harder.

    RE .53
    
    No the punchline has changed. The one remaining crewman was sent home,
    wiothout an oar, and told to row from there. You really must keep up
    with the times.
    
    -OFWAMI-

    re. 52
    
    You hit the nail on the head.
    

>    .50 sums it up pretty well and maybe here is another clue as to what
>    is wrong with this company: Someone asks how Q3 is going and look 
>    at the answers he gets.
    
    55 answers, ranging from the researched to the reaching, with a little
    humour thrown in.  Couldn't do better in a variety magazine, if you ask
    me.
    
    If you're looking for just one answer, read BP's latest release.  It
    begins "It took us a long time to get in...".  Oh, sorry.  That's how
    they *all* begin, isn't it? :^]
    
    								Tex
    
    (Thanks to all of you who take the time to make these silly-a**ed
    comparisons to the Titanic, why OJ should be our spokesman, and how
    bikinis affect the bottom line. :^]  Y'all make *my* day!)

    
>    If you're looking for just one answer, read BP's latest release.  It
>    begins "It took us a long time to get in...".  Oh, sorry.  That's how
>    they *all* begin, isn't it? :^]
 
    Tex, surely you haven't forgooten the old "Digital has just achieved its nth
    consecutive quarter-over-quarter improvement..."
    
    For some strange reason ;-) this press prologue went out of style
    as fast as tail fins on a '63 Chevy.
       
    re roelof

I don't know whether or not the following item is indicative of the Q3 
performance, however the paragraphs regarding headcount reduction in the 
next few weeks, i.e. before end of quarter must be significant!

I also found the item imediately after the one about G&A very poignant!

regards

Patrick    

(From Vogon news today)


 Digital - To cut G&A costs to meet financial model
        {Digital Today, 20-Mar-95, p. 1}
 
    Now and through the end of calendar year '95, Digital will be taking 
broad steps to bring its General and Administrative (G&A) costs in line 
with the company's new financial model.

   According to Vin Mullarkey, Digital VP, Finance and chief financial 
officer, the G&A costs, including such functions as Finance, Facilities 
Management, Human Resources, Communications and Management Information 
Systems, must be reduced to competitive levels.


   "Our existing business straegy is working," said Mullarkey, "and we've 
made substantial progress, improving from an after tax loss in FY '94 of 4 
percent to break even in Q2.  We have a considerable amount of work ahead 
of us to achieve the short term goal of earning 5 percent on revenue.  
Closing the G&A competitive gap is the most significant initiative require 
to meet this objective."
   He cites significant progress to date in the company's turnaround,
 including:
   o Four successive quarters of product order rate hrowth.
   o Three successive quarters of product revenue growth.
   o The successful arrest and trunarounf in gross margin declines.
   o Significant cuts in research and engineering.
   o And, of course, a profit in Q2.

  But even with all theat progress, the so-called SG&A (Selling, General 
and Administrative) costs, often called overhead, continue to be too high 
relative to Digital's revenue and profitability.
   The target is to take about $700 million out of the annual G&A expenses.
 (Selling costs, which have already been dramatically lowered by the 
changeover to third-party selling, will be re-evaluated after all the new 
business units, primarily the Systems Business Unit and the Accounts 
Business Unit, are fully operational and their new cost structure can be 
analyzed.)
   
 Of that $700 million in G&A, about 45 percent will come from a reduction 
in headcount - or some 3,150 people.  About 2,000 positions will be moved 
out of Digital in the next several weeks, with the balance of the 
reductions occurring through the remainder of the calendar year.
 
 "Everything we've done so far," said Dick Farrahar, VP, Human Resources,
 "the downsizing, the restructuring and the recent reorganizing - they've 
all been positive and necessary steps toward turning our company around.  
And we've done an outstanding job in cutting costs throught the G&A 
functions. However, these additional reductions, difficult as they are, 
will contribute directly toward helping to achieve our goal of returning 
Digital to sustainable growth and profitability."
   The other 55 percent will come from "non-people costs."
   These include comapny-wide programs to simplify, improve or eliminate 
work and reduce and eliminate non-essential expenses.  Digital's extensive
 facilities management, for example, will be handled by vendors 
specializing in that work.
   At the same time, as part of the general effort to reduce costs, overall
 expenditures on facilities will be greatly reduced.

  "We're going to take some risks, no question about it," said Jeff Clarke,
 manager of Corporate Financial Analysis.  "In our function, Finance, we're
 going to stop doing ceryain analyses on a regular basis, and do them only 
when required.  A lot of analyses and reports will be eliminated, and many 
of those that we continue will be done in summary form., at great cost 
savings. Essentially, we're going to get back to the basics, do what needs 
to be done, and cut out all the rest.  This will not only save a lot of 
time and money, it should greatly simplify our business - which, in 
addition to cutting costs, is a primary goal."
   According to Mullar;ey, these major steps in reducing G&A will go a long 
way toward sustaining Digital's short-term profitability - and greatl 
enhance the company's long-term competitiveness.


 Digital today announced the appointment of Jeffrey Brooks as vice 
president of marketing communications, reporting to Charlie Holleran, vice 
president of communications.  The appointment is effective immediately.

    No toilets in Corning facility either..
    
                               Steve J.

     Re: .58 
    
     Anyone know what the 'financial model' might look like? 
     
     Anyone know what the 'competitive levels' are? 
    
     jc
       

There once was a VP named Naper
And this was his crooked caper
  He went in the john
  When all were gone
And stole all the toilet paper.

    Is it just by chance that $700m is 5% of a $14b dollar revenue figure?
    

    The rumor is that the financial model looks similiar to the corporate
    software strategy!

    The question I have is -
    Is there any reason to believe that the Company's financial reporting
    mechanisms are better than they were prior to last year's "surprise".
    
    Beyond that - is this article the preparation for the bad news?
    In other words - yes, this quarter looks bad, but look at the steps
    we're taking to improve things.
    

    The other concern I have about this is...
    
    Is it wise to say that the Company will be taking some risks in
    changing their accounting practices - just prior to releasing the
    quarterly results?
    
    Or - is it thought that DIGITAL TODAY articles don't make it to the
    street?
    

>    Is there any reason to believe that the Company's financial reporting
>    mechanisms are better than they were prior to last year's "surprise".
    
    I can assure you that the financial reporting mechanisms are no better
    than they were last year. And is probably going to get worse,
    considering the current political battles surrounding two major and
    competing financial reporting environments.
                
    Re .50 Addendum: The bridge is stuffed to the gills with 'Old Boilers'.
    
    Angus

    Well... I'm doing my part.  Today is voluntarily my last day.  For the
    most part I've really enjoyed working for Digital... but I can't take
    it any more.  My new manager promises that I will be able to implement
    something that I start to work on.  :-)  Not that things are my
    manager's fault... at our level in the food chain his hands are tied.
    
    I wish Digital well... but my opinion is that the eventual result of
    downsizing is "out of business".  
    
    Working for IM&T (overhead) it has been a very frustrating last couple
    of years.  All of the worker-bees have been shot... the systems have
    broken... and nobody will make the investments to fix it.  It's like
    letting the highway system rot for 10 years, the demand increasing on
    it year-after-year... and then saying "why are there so many traffic
    jams?".  Result... layoff the maintenance people?  There is no quick
    fix.  It is a total and absolute mess... I really wish someone in the
    upper levels would get a clue.  A lot of money has been wasted on
    attempted solutions... but nothing is implemented so the money spent is
    sunk cost.  
        
    Anyways... enough of my ravings.  I really do wish Digital the best.  
    It has the best-hearted people (I can only speak for the "worker-bees") 
    that are working against a tide of mixed-messages and lack of 
    leadership.  It certainly has some of the best products.  I will miss 
    it... some of it anyways...
    
    Don

Symbol        : DEC          Exchange    : New York Stock Exchange (NYSE)
Description   : DIGITAL EQUIP CORP                           
Last Traded at: 34.500       Date/Time   : Mar 24 11:40:28
$ Change      : 2.250        % Change    : 6.98    

Volume        : 955200       # of Trades : 215      
Day Low       : 32.500       Day High    : 34.500   
52 Week Low   : 18.250       52 Week High: 38.750   

    re: .71
    
    Well, the market as a whole is way up, and most of the high tech stocks
    are up too.  Although most aren't up 7% like Digital.
    
    	Steve

    Re: Note 3742.71 by GOTIT::harley

�                 -< Good news? >-
    
    Wall Street always like to hear of more heads put on the chopping
    block.
    
    	BD�

    Naaah.. the word finally got out that I sold a pile of stock last
    week..
    
    ...tom

    CNN reported that semiconductor stocks are up due to favorable currency
    exchange rate, especially in the Far East.

     

    Back to the story line on sailing the ship.
    
    So, the Captain of the USS Digital comes down into the slave galley and
    says," Men and Women of the Empire, I have good news and bad news to
    share with you from Fleet headquarters.  So, one slave, err I mean one,
    individual contributor hanging on an oar, tugs at the Captains pant
    leg and says, "Tell us the good news!" and he says, "The Fleet Admiral
    has authorized extra wine and bread for the evening meal and has
    promised to look into performance raises for all!" and a big cheer goes
    up amongst the crew. 
    
    A second pant leg from the other side is tugged and being diversly
    balanced the young IC with gleem in her eye and hope in her heart says,
    "Tell us the bad news!" and the Captain says:
    
    
    			"The Fleet Admiral would like to go water skiing
    			 in about 15 minutes!!"
    
    Mav

    
    Mav -
    
    	C'mon - that's older than I am. This is about Q3 opportunities
    for "whether to sell my stock now (at inflated prices), or keeping
    it longer (be still my greedy heart) for even GREATER appreciation
    in American dollars".
    
    	Now having properly established the focus for further discussion -
    
    
    	
    
    
    		I heard we're getting a new admiral....
    
    
    			the Greyhawk

re.:<< Note 3742.77 by POBOX::CORSON "Higher, and a bit more to the right" >>>
    
>>    		I heard we're getting a new admiral....
    
    What ?????
    
    Going back to the topic...
    DEC share are rising quite a lot! I've never seen 3$ in one day !
    
    Is it rising because Q3 is good? Do YOU know something I don't know?
    
    Ciao.
    �A�

re .77

Greyhawk,

You just cannot drop a remark like 

 " I heard we are getting a new admiral "

and walk away from it!


come clean!


Patrick

    >DEC share are rising quite a lot! I've never seen 3$ in one day !
    
    No, but I've seen -$45 in one day.
    
    					andrew

    
    	Ok, everybody - chill out!!
    
    	Rumour mill says SBU is getting a new boss. Remember Enrico is the
    	BIG boss of CSD (of which the SBU is part of...) and "acting" boss
    	of the SBU.
    
    	Geez, relax - like the Navy, there are lots of admirals (VPs) here.
    
    	Worry more about revenues and shipments in Q4 - now back to rowing
    	your brains out...
    
    		the Greyhawk

    Ron Larkin just left Canada for the States......
    
    
    Brian V
    

    Hey Greyhawk I hear we are indeed getting a new Fleet Admiral.  Word
    on the Rumormongernet is that DEC semiconductor will be spun off (as in
    sold) and the Fleet Admiral will get a hand shake and go off to run it. 
    Think about it, it's not exactly unsupportive of Vin's goals (cut
    costs, reduce spending, reduce G&A, reduce manufacturing costs, reduce
    R&D etc...) like he told us in Chicago a month ago and the new
    semi-ops. can run independently of us and set up a merchant contract
    exclusively with Digital to sell us all the Alpha's we will ever need.  
    
    Sounds like it would work to me....in fact I recall didn't you advocate
    this strategy awhile back, in essence let's sell Alpha's to whoever
    wants to come up to the window and buy them, kinda' like beef on
    Saturday morning down at the market:
    
    		"Can I help you mamm?"  
    
    		"Sure, I'd like two pounds of fresh Sable and
    		 three really nice one pound and one-inch thick
    		 Turoblaser's for the grill"
    
    Mav

    
    Mav-
    
    Agree completely on selling Alphas to anyone who can write a check that
    won't bounce. Not sure about the Fleet Admiral speculation part (or
    for my Navy Buddies, a *new* CNO), but being (existing?) in the SBU
    these past months, any change would be a plus...
    
    Too many days when I know my kids could run this better than...
    
    Oh, well, the 'hawk's gonna return to his nest for the week.
    
    	XXXXs & OOOOs
    
    		the Greyhawk

> Agree completely on selling Alphas to anyone who can write a check that
> won't bounce. 

Amen, Greyhawk!

We're already doin this ... at least with Alpha CHIPS.  Just got a coupla big
checks too.  We'll see whether they bounce.  Either way, they won't get
'cached' til next FY. :-)


- jeff

You make the call...

                    "Eating Spam in the 90s"
 
                             - or - 

    "Resolved: That Digital should keep Digital Semiconductor"



re: 3742.83
> Word on the Rumormongernet is that DEC semiconductor will be spun off (as
> in sold) and the Fleet Admiral will get a hand shake and go off to run it.
>
> ...and the new semi-ops. can run independently of us and set up a merchant
> contract exclusively with Digital to sell us all the Alpha's we will ever
> need.  

Although Digital Semiconductor (DS) currently runs an operating loss, I don't
believe that the Digital Systems Business Unit (SBU) could afford to pay for
Alpha chips (or something similar in performance) on a 'free market' basis.

First and foremost, Alpha chips are expensive to make (hence they would be
even more expensive to buy), and while the SBU might get as much advanced
design information on next generation parts by designing them in house and
fabbing externally, they probably won't get the high-performance process they
want from an outside company.  Besides, designing for external fab houses can
be somewhat of a b*tch.  Ask some of the 'Dagger' folks.

And as an aside, I can gaire-uhn-teee you that if someone with enough cash to
afford $400M worth of FAB6 buys DS, they're not gonna use it for making
Alphas.  No way, no how.  If they do, I'll eat my weight in Spam.

DS runs a loss because it's charges the SBU less than a 'fair free market
price' for Alpha chips and it doesn't have enough other revenue to cover the
difference.  (I define a 'fair free market price' to be what it costs DS to
make them plus a reasonable margin.)  In effect DS subsidizes the SBU via some
rather large negative margins and that subsidy shows up as a big red 'L' on
DS's P/L sheet.  This kind of breaks the 'independence' of the Business Unit
model.  Just to satisfy an idle curiosity, how much black 'P' will the SBU's
Alpha Systems Org make this year?  Is it more than our red 'L'???  

This will likely end up as yet another folder in the case study file for the
B-schools.  I've seen it before, and it's a nasty trap to be stuck in.  Yet
another company selling it's products at a loss to increase market share ...
yet another company dies.  It only works if you can drive the competition out
the market completely (in the case of Japanese TV makers).  And those days are
long gone.  People are too keen and information flows too freely for that to
happen in the high-tech biz.  The only way to get out of a trap like that is
to hire a real sum-b*tch of a senior exec VP and let her/him fire off all of
the senior management below him/her.  Hell, what do I know?  I'm just a
digressing mfrg engineer.  My Dad on the other hand... 

DS is frantically trying (and succeeding -- see today's and other recent VNSs)
to wedge into the commodity PCI controller/bridge, Ethernet controller, PC
video chip, and similar markets with some excellent products.  And if DS's
newly hired sales and marketing cr�es have it together, in 18-24 months we
just might be able to sell enough of 'em to finish fitting out the new FAB,
get some breathing room to try some zany ideas, and also manage to cover the
SBU's Alpha subsidy at the same time.  Optimist?  Where?!  Who Me?!?  <slap!>
<slap!>  <slap!>  <slap!>

> Sounds like it would work to me....in fact I recall didn't you advocate this
> strategy awhile back, in essence let's sell Alpha's to whoever wants to come
> up to the window and buy them, kinda' like beef on Saturday morning down at
> the market:

Typical margins on high end CPU chips are rather large (percentage wise)
compared to systems and components (where *do* Intel's huge profits come from
anyway?)  I don't know if the SBU could afford such a "Saturday morning
market" price for an Alpha.  When we announce our new EV chips, we put them on
the same price/performance curve with Intel, but we're orders of magnitude
from their economy of scale.  Doesn't take much math to figure out why we run
a loss here in DS.

Besides, there aren't many other high-speed 8" processes out there that could
make an Alpha class chip.  Everything else is optimized for other attributes
(e.g. low power, high yield, etc.).  "Ahh, but Jeff, Mitsubishi has one!" you
say.  "I remember that they even signed a deal to 2nd source Alphas!"  Well
that fab got trashed in the Kobe (sp?) quake.  Rut roh, Raggy!

Sure DS costs Digital money, and it ain't chump change.  You'll be able to
look at the Digital Corporate annual loss this fiscal year and be able to
attribute a significant portion of that to DS, or maybe all of it if you're so
inclined.  Just remember to take off the $150M or so it costs us to design and
make Alpahs each year and put it on the SBU's P/L sheet and then recalculate
:-) 

BP's kinda stuck.  He bet the company on Alpha and showed his cards to the
world.  If he lets the Board sell DS, he lets the Board throw in the towel.
I'm sure that the scenario of selling DS has passed across the big oak table
more than once, and I'm sure it will again.  If he want's Alpha systems to be
successful, he better cut DS some more slack and let us invest what resources
we need into other products to cover the cost of making Alpha chips.  Every
dollar that has been invested in DS for designing and manufacturing non-Alpha
chips will probably have paid back $5-$10 two years from now.  Look at The
McAllan Project.  A mere handfull of folks with a shoestring budget made
Digital Semiconductor $millions.  Tulip, FasterNet, and Dagger are Sierra
Hotel!  If we can keep our talent, and buy just a wee bit more, then we're
home free.  Well, almost free :-)


And now for a Pep Rally, Sluggo style...

If DS goes, Alpha goes with it, and Digital Corporate is in deep clodhoppers.
All the Media_Hype(tm) about "Alpha is Digital's Future" will be in our dreams
of days gone by, and the FUD will fester somethin fierce.  There will be
little left other than the PC Biz, some rather clever NT products, and the
Components busines, and a few others, to hold up brightly shining new products
to Wall St. in a vain attempt to keep them from ducking and running.  

All that stuff *is* something, but most of the money is milked from the
components and services cash cows, and cash cows don't grow.  They get old and
they die.  And when they die, they rot and stink up the barn.  Dare I speak of
the remains of the biggest, deadest, stinkiest Cash Cow in Computer history?

Well of course I do!


            vvv
    It's  > VAX <
            ^^^

Now, before you go stainin yer britches...  please learn this lesson:

                                           vvvvvv
    The trick is to start feeding the calf before the cash cow dies.
                                           ^^^^^^


But since Ken didn't do that, Bob and the rest of us have had to sweat it out,
dig us a nice big hole, and bury the rotten VAX carcass.  It's time to stuff
the pride and lose the egos, and start feedin' the calf all it can swallow.


This ain't your Father's Digital.  


There ain't no company picnics and there ain't no free tickets to Wally World.


There ain't no matchin 401k program, and there ain't gonna be no Social
Security.


Don't like your work environment?  Then fix it.  Don't like the city you live
in?  Then leave.  


There's survival-n-success, and there's misery-n-death.  Pick one.

--



Welcome to the Human Race.


- jeff_who'll_fix_it
  _or_eat_Spam


PS -- I don't like Spam.

    Sh*t! It seemed like such a nice rumor. Good for at least another 50
    replies.
    
    Al
    

> difference.  (I define a 'fair free market price' to be what it costs DS to
> make them plus a reasonable margin.)  In effect DS subsidizes the SBU via some
    
    Interesting definition .. Sounds more like 'oligopoly market price'..
    
    Or the phone company..
    
    ...tom

    
    	Would really like to wax on and on about the value of Digital
    Semiconductor, merchant chip houses, the need to sell systems (not
    boxes), etc.; but Mr. Roemer stole my punch line, so....
    
    	the Greyhawk

  Okay, I'll step into the ...

  The rationale in .whichever sounds fine until you consider that
  the reason that Digital Semi sells Alpha chips at a loss to the
  SBU is that if they charged a profitable price, then the SBU
  would simply do what the ENTIRE REST OF THE WORLD does:

      o Buy Pentiums or PowerPCs, and kiss-off Alpha


  Somebody blew it big time when RISCy VAX, SAFE, PRISM, and then
  Alpha *ALL* failed to get any significant third-party market
  penetration. (For that matter, somebody blew it equally big when
  VAX-11 and, before that, PDP-11 failed to even get *OFFERED* as
  a chip solution for third parties. It's for that reason that the
  6800, the 6502, and the 68000 were all developed.)

  It's not at all clear to me that Alpha has any future, except
  as a "boutique" niche microprocessor for those who want the
  absolutely blazingly fastest uP, and damn all other considera-
  tions (like compatility, power consumption, and cost.)*

                                   Atlant


* And reliability of the sole source?

re Note 3742.91 by ATLANT::SCHMIDT:

>   It's not at all clear to me that Alpha has any future, except
>   as a "boutique" niche microprocessor for those who want the
>   absolutely blazingly fastest uP, and damn all other considera-
>   tions (like compatility, power consumption, and cost.)*
  
        And odds are that even the unquestioned advantage in speed
        will remain without challenge only for a few more years at
        best.

        Then what is our advantage?

        Bob

    
    	Bob, 
    
    	Our advantage is what many of us have been saying for several years
    now..We engineer, manufacture, and support SYSTEMS. And a system is all
    the pieces - Servers, clients, networks, software (take your pick on
    the food chain), and support for all the above.
    
    	I personally would like to tatoo this message on the SLTs foreheads
    
    	"IT'S THE SYSTEMS, STUPID"
    
    	And if we ever decide to leave that arena, then you've just seen
    the high stock prices on DEC.
    
    	'Cause that is where the margins are - in systems!!!
    
    
    		the Greyhawk

    re .87
    Nice writeup.
    
    Hindsight is 20-20, but perhaps offering the original 21064 at a
    rediculously low, loss-leading price (instead of $1400+ if memory
    serves) might have been enough to lock up a big name box maker
    (Dell, COMPAQ,...) to get the volume needed for reach efficient
    production levels.  IBM probably took a bath on the first year
    of PowerPC, but now Apple can't build enough boxes to satisfy
    demand.  kb 

    FWIW, if we really want to sell Alphas, we should probably do something
    akin to what Motorola did recently.  See the EE Times "Special Issue."
    Found it with my March 27, 1995 issue of the regular rag.  This
    "Special Issue" is subtitled as the "1995 Systems Design Guide" and is
    sponsored by Motorola Semiconductor.  Seems like every other page has a
    Motorola ad.  The back has spec sheets on lots of parts including the
    PowerPC.  In fact, PowerPC is all over the place in the 148-page glossy
    magazine.  Lots of technical articles ...  I didn't happen to see any
    recommendations or mention of support for Alphas anywhere in the rag ...
    
    Steve

re: .94

> Hindsight is 20-20, but perhaps offering the original 21064 at a
> rediculously low, loss-leading price (instead of $1400+ if memory serves)
> might have been enough to lock up a big name box maker (Dell, COMPAQ,...) to
> get the volume needed for reach efficient production levels.  IBM probably
> took a bath on the first year of PowerPC, but now Apple can't build enough
> boxes to satisfy demand.  kb 

We are taking a bath ... a nice long, cold, expensive one that won't end until
FY97 at the earliest.  

By then, hopefully we'll be selling millions per year of our PCI, Ethernet,
Video, etc. chips at low but PROFITABLE prices.  If we can somehow manage one
or two more McAllan (AMD 486DX80's) or StrongARM (low power high speed 32bit
RISC CPU for Apple Newtons) projects, then we just might beat it in FY96.
Whoops! there I go playin' optimist again.  <slap!>

The trick is to ignore Alpha.  Forget the hype about it being in every desktop
system, and forget it taking the world by storm.  Let it do it's thing with
the SBU and Alpha Systems, which *will* continue to slowly grow in volume, and
we'll pay for it with the other products.  The more 'other' products we make,
the sooner we make Alpha profitable.

The downhill slide ain't over just yet.


- jeff_sold_stock_on_Tuesday

    Re: .96
    
    Jeff who just sold stock on Tuesday did a very very bright thing.  He
    probably sold the stuff he did during the last purchase in December
    which means he bought that stuff around $18.00 a share.  If memory
    serves he sold it on Tuesday for say $37 5/8's a share thereabouts.
    
    Now a little math folks:
    
    		(# of shares)* (Sell price-Purchase price)
    
    	Example: (100) * (37.625-18.00) = $1,962.50
    
    	Net gain: 109%  Not a bad return in 4 months....
    
    Seriously, the piece he did up on DS was priceless and should be read
    by all with the cold beverage of one's choice in one's hand.
    
    Priceless, absolutely priceless....even the BOD could have understood
    that!
    
    Mav

    
    Ditto...Great job on the write-up Jeff.
    
    
    /Charlie  Who_just_dumped_a_few_shares_too!!!
    

    
    	re: -few
    
    
    	First, you are assuming the BOD can read. Seeing how long it has
    taken them to even begin to ask the right questions (which is
    subjective, of course); I have serious doubt - my feeling is the BOD is
    perminently asleep at the switch, and only those who can sleep at the
    switch need apply.
    
    	Second, DS is a treasure; and while some divisions may not
    understand that, some do (C&P for example, who is using Alpha in Multia
    with the effort to sell hundreds of thousands over the next several
    years).
    
    	Third, we do not exist in a vacuum. Too many people here at DEC (so
    sue me!) appear to be trying to separate us all into little niches in
    order to *measure* their own P&L. This too will pass; meanwhile we in
    the trenches must either grin and bear it, or practice a little
    political pressure of our own...
    
    	SUGGESTIONS ??
    
    
    		the Greyhawk

29Mar95 USA: RESEARCH ALERT - DIGITAL EQUIPMENT RAISED. 

-- PaineWebber upgraded Digital Equipment Corp to attractive from neutral, 
a market source said.  

(c) Reuters Limited 1995

.... explains stock gaining 6 points in one week.

Thank you, PaineWebber.

    And now from the the cynic's point of view - (like we don't have enough
    of this already).
    
    Could it be that some borkerage houses up their "opinion" of selected
    stocks in order to satisfy some of their larger accounts?
    
    Meaning - after a bit of window dressing, wouldn't it be nice if
    you had a ready made audience of buyers who are willing to help you
    lock in your handsome profit?

EXcuse me, hows Q3 looking ?

ALan

    Sounds like its looking fine if you're in the share-trading business.

It's a damn dirty shame we're sitting on the world's fastest microprocessors,
not just one, but a whole family, and we can't seem to turn it into a
profitable business. So far, this is a management failure of such vast
proportions as the free market rarely sees, perhaps similar to GM under
Smith, only worse. After all, Smith didn't have a decent product to sell.

Now the PC industry is all hyped and ready to accept RISC as a successor
to Intel. We have all the marbles, but we're keeping them in a bag behind
our back, while Moto and IBM show their flawed marbles to all who will
look and proclaim them to be 1st order jewels of the realm. Customers
compare them to their old scratched marbles. Aside from a few timid
complaints like "they're no bigger than our old marbles" and "why aren't
they round?" the customers are patiently awaiting their chance to play
with the new marbles.

Herewith some reasons why Alpha is the right processor family, RIGHT
NOW:

1) It's the fastest there is

2) People want fast, Pentium is selling like mad.

3) Intel is pursuing a strategy for CPU-intensive Multimedia! Maybe
   it'll even be FP-intensive!

4) We have the fastest NT machines in the world

5) Windows NT is increasingly compatible with Windows 95

6) We have emerging translations technology that will make it possible
   to translate Win 95 x86 .exe files into Alpha Win NT .exe files.

7) We have Alpha system designs that are PC-centric, the right bus,
   the right peripherals, the right endian

8) Alpha systems designed like PCs cost within 5% of a PC to build,
   feature for feature.

9) Our chips and systems have a reputation for technical excellence.

10) We have two years experience with Windows NT, compilers, tuning,
    etc.

We could put RETAIL Alphas in stores by Christmas 96, maybe from multiple
system vendors, IF WE WORKED AT IT. This is in addition to the more obvious
triple-digit growth corporate NT market.

WILL SOMEBODY UP THERE PLEASE WAKE UP AND MAKE A SERIOUS ATTEMPT TO SELL
THIS STUFF IN VOLUME?? No more toes-in-the-water please! It's warm enough!
DIVE IN!

--RS

Re: .106

You got ten reasons to buy Alpha over Intel. What is the showstopper?
Price/performance! I think we need at least 1.5-2x the price/performance
over Intel to motivate people to move to Alpha in volume. An Alpha machine
also needs about 16MB more memory than a Pentium to run with comfort (if
both runs Windows NT). It doesn't help on the price/performance ratio.

Olav

    I'll go further than -RS: we could be there by christmas '95, at
    price/performance parity at all x86/P_PC performance points 
    from several vendors (not necessarily at all performance points)..
    
     IF..
    
    we really wanted to.
    
    But we don't want to, as far as I can tell.
    
    ...tom

>>> An Alpha machine also needs about 16MB more memory than a Pentium to run
>>> with comfort (if both runs Windows NT)...

Actually, recent measurements show the penalty to be about 3 Mbytes, not
16 Mbytes. That's about $75 worth of memory, and the price is falling.

--RS

    good grief, I can't believe I responding to something with
    over 100 replies...
    
    re: .108  I agree with Tom and offer this evidence.  Mr. Supnik
    presented to our group just a few days ago and one of the slides he
    used said "Intel and Alpha synergy".  Backing this up, he pointed out
    that one has high volume while the other has high performance.  The two
    architectures cover the whole range of computing, from portables to
    supercomputers.
    
    Mark

    ...and Digital offers its customers of a choice of either.
    
    Mark.

    It seems all you technoids miss the point on replacing Intel as the
    desktop chip of choice and replacing it with Alpha.  If you want to
    play in the desktop market, you have to be able to manufacture chips in
    TREMENDOUS volume.  Having just toured an Intel manufacturing facility
    in Phoenix and having seen in the distance their new FAB facility under
    construction, and knowing that they have 11 other such facilities,
    Digital cannot currently compete in the desktop business.  My friend,
    who is a manufacturing engineer with Intel, told me that Intel did $12
    billion last year and expects to do $20 billion this year.
    
    So before you bad mouth Digital management anymore, please articulate
    how Digital can overtake Intel in the desktop.
    
    1. How many chips can Intel produce per year?
    2. How many chips can Digital product per year?
    3. How much capital spending would it take for Digital to catch up with
    Intel?
    4. How will you migrate legacy applications from DOS, Windows and OS/2
    to Alpha?
    5. How will you get third party vendors (hardware and software) to
    abandon Intel for Digital?
    6. In the meantime, Intel could decide that they are not going to sit
    still as Digital tries to move into the desktop arena, so Intel goes
    three shifts in the plants and drops chip prices 50-75%.  Whats Digital
    going to do?  They can out muscle Digital any day of the week.  They
    have a huge installed base, TREMENDOUS volume, established distribution
    channels, and great marketing.
    
    Digital should concentrate on the server market.  Don't pick a fight
    with someone you can't beat.  Perhaps Digital's management knows this.

    
    The Intel fab you saw in Phoenix is Intel's oldest, and least
    efficient.  It makes memory controllers,X286, X386  and the like.   If
    you think the volume there is tremendous (it's at least a 10 year old
    fab),  wait until you see the new one.     Volume is the key, and with
    over 30 million X86s sold last year, Inel is the only player in that
    game.
    
    Bruce

re .114

	I thought we were talking about NT's advantage as a server, not the 
full desktop market where more is not always better.  Alpha volume should not 
be a problem in the server market, which has the steepest potential growth 
curve.

	By the way, I've been in some of those Intel fabs, working to help 
them keep running full blast.  Everyone should know that Intel runs all their 
factories worldwide on VMS clusters.  They're a very large account of ours.

		David

re:<.114

	You want ALPHA chips, we'll make em.  Just tell us how many and when.

Re: Note 3742.110 by WRKSYS::SCHUMANN
    
> Actually, recent measurements show the penalty to be about 3 Mbytes, not
> 16 Mbytes. That's about $75 worth of memory, and the price is falling.
    
    Please point me to some documentation on the above. I have had several
    calls from customers running AlphaStation 200 4/166 or 400 4/233 with
    32 MB of memory complaining that their system runs too slow and pages
    like crazy when running native Windows NT/Alpha apps like Word 6.0 for
    Windows NT (no Intel emulation). I told them to add more memory 8-16MB
    and they called back and was very satisfied with the speed. This
    difference is even more noticable for customers who have upgraded their
    Pentium 90 based DECpc XL to 233 MHz Alpha.
    
    Olav

    I could  just about believe that the NT kernel might be only 3 Mb
    larger  for Alpha than Intel - but add some real world applications
    like Olav says (not just one, after all this is supposed to be
    multi-tasking) and the situation looks different.
    
    On the other hand, most softare providers probably don't even attempt
    to do any size optimization for Alpha (few enough to provide an Alpha
    version at all).
    

    Just wondering.......
    
    How's Q3 Looking???

Reinhard:

  What's the "shrink-wrap" penalty these days?  There's still no '386
  emulator is there? Lots of shrink-wrapped stuff WILL NOT RUN and what
  does run certainly does not show Alpha at a performance advantage to
  currently shipping Pentiums, and certainly doesn't show Alpha at a
  price/performance advantage.

  What's the "support" penalty? Windows/NT HAS NOT Captured the desktop
  and there's no evidence that it will unless Windows/95 bombs. Customers
  want the successor to Windows/3.1 because thats what they know.

  What's the "no bytes/no words" penalty? What strategy will allow 21064
  and 21164 to ever overcome this? "Sparse space" certainly is unpopular
  among my customers.

  What's the power/cooling penalty?

  Where's the second source with all those wonderful low end chips?

  The market momentum is still with x86, and for some very good reasons.
  PowerPC has what it takes to overcome that momentum; Alpha doesn't.

                                   Atlant

    I too was wonder how Q3 is looking... After reading the last few, I
    don't have a clue...
    
    

    The last few give me a major clue as to how Q3 is looking.
    

For those interested in how we could market Alpha more successfully,
may I recommend a book I'm reading:

  "Marketing High Technology, An Insider's View"
   by William H. Davidow

Davidow was senior vice president of sales & marketing for Intel
Corporation and shepherded the Intel 8080 and 8086 to success against
a much larger Motorola with stronger "devices".

One point he makes seems especially relevant:

Customers don't simply buy devices, they buy "products",
and the product includes sales, field support, documentation,
software, tools, service, and all the other factors that make
the purchase a success for the customer.

Alpha is a great device, but it's no where near as complete a PC
product as an Intel 486 or Pentium.  The cost of creating a complete
product can be many times the cost of developing the device.

The job of marketing is to invent complete products and drive them
to commanding positions in defensible market segments.

- Peter

    And since its lying here right next to me and I've just finished
    reading it I can highly recommend:
    
    Crossing the Chasm
    - Marketing and Selling Technology Products to 
      Mainstream Customers
    
    Geoffrey A. Moore
    Harper Business
    ISBN 0-88730-519-9
    1991 (but still painfully up to date)
    
    And now back to our topic: How's Q3 looking? :-)
    
    re roelof

When is the earning report for Q3 due ?

    > When is the earning report for Q3 due ?
    
    
      Look for it the week of April 17...
    
    

    ...unless they're really awful (see 1842.1)

    Re .123: We do have the product (but maybe you didn't know)
    
    You _can_ build a *complete* Alpha PC around Digital's 21066 chip
    (LCA?) with just as little glue logic as a decent x86. Digital even
    has boards to sell based on it so folks can build "PC clones" with
    industry standard boxes, PSUs, etc. But not many people do, because it
    doesn't run DOS/Doom/Win3.1 and so isn't in the same market as x86. And
    any performance advantage it may once have had is rapidly vanishing as
    we twiddle our corporate thumbs... 233MHz chips exist now, rather than
    the original 166MHz, but the 233 boards don't get marketed yet. Weird.

    Re: Note 3742.125 by AIAG::KIM
    

�When is the earning report for Q3 due ?

    According to Digital Shareholder Direct (800-998-9332) the numbers will
    be announced on April 19.
    
    	BD�

    
    hm, same day as last years announcement. Let us hope there are no
    "surprises" in this one.

    Don't know if it's good news or bad. But Bob Palmer was reported as
    saying during his recent visit to Galway in Ireland that he expects
    profits in Q3 and Q4, is concerned about Q1, and indicated that we were
    still turning the corner.
    
    Fraser_B

    
    <---- .131  how long ago did Bob Palmer say that?

    Bob Palmer was in Galway and talked to employees on Monday of this
    week.
    
    Gita

    
    If anyone should know, Bob Palmer would. He certainly doesn't want
    anymore "surprises" sprung on him, after last year's fiasco.
    
    Mark

Anyone who is continuously turning a corner is going in circles.

Jim

I was present at the Bob Palmer session in Galway on Monday of this
week, 

I was surprised that he thought we would turn a profit for both Q3 and
Q4 FY95.  What he didn't say was how big each profit was estimated to
be though.  Don't expect miracles and you won't be disappointed I
suppose is the moral of this story. 

Aside: Bob seems to be a good speaker.  Every question that came from
the floor was turned into what Bob's theme of the day was.  He was
asked about a software strategy (or lack of) and said (don't quote me)
that we have a software strategy but we don't quite know what it is
yet.  I might be getting this a little out of context but I think that
this was the gist of what he said.

I was a little pissed as I had a question prepared for him but didn't
get a chance to ask it.  It went something like: 

"Over the past 4 years we've halved our employee count, but doubled
the number of VPs in the company.  How do you explain this and what
signals does this send to employees?" 

How do you think he would have answered this little teaser? 

IMVHO: I think Bob got off very lightly from the questions and answers
session on Monday.  He was asked no really hard questions and avoided
mentioning what might happen if things didn't go as expected at the
end of this Financial Year. 

    
    
    	RE .136
>"Over the past 4 years we've halved our employee count, but doubled
>the number of VPs in the company.  How do you explain this and what
>signals does this send to employees?" 
>
>How do you think he would have answered this little teaser? 

    I would expect the explaination to be pretty similar to my 3732.99
    The signal it sends is that hard work will be rewarded. This 
    includes promotions. For many senior managers the next promotion
    would be to VP. 
    
    					Ed
    

��<<< Note 3742.136 by XSTACY::JLUNDON "http://xagony.ilo.dec.com/~jlundon :-)" >>>

��I was surprised that he thought we would turn a profit for both Q3 and
��Q4 FY95.  What he didn't say was how big each profit was estimated to
��be though.  Don't expect miracles and you won't be disappointed I
��suppose is the moral of this story. 
    I believe that a few quarters back, Mr. Palmer complained
    that the size of the quarterly loss was a suprise to the SLT.
    Since SAP isn't online yet, what reason is there to assume
    that his data is any better now?   Not that I didn't hold
    him equally responsible for the loss and poor information
    management.  So, Q3 may be profitable.  If it isn't, we can
    just claim we were suprised by the results.   I'm planning on
    using this strategy with the IRS.

    ��Aside: Bob seems to be a good speaker.  Every question that came from
��the floor was turned into what Bob's theme of the day was.  He was
    I don't know that this is a 'good speaker', but Mr. Palmer
    seems to be adept at answering the question he has an answer
    for, rather than the one which was asked.  To paraphrase an
    exchange I recall:

         "Q: With the company in the dumper, and no raises for
             grunts in years, don't you think it was insulting
             to 'the masses' to take a 20% raise?

         "A: I think you'll find that digital executives are paid
             fairly in the industry."

��"Over the past 4 years we've halved our employee count, but doubled
��the number of VPs in the company.  How do you explain this and what
��signals does this send to employees?" 
    Well, his answer might have been:

    "Well Jim, may I call you Jim?  That's an excellent question.
    I'm sure that is a question that many employees would have asked
    here today, if they'd have the opportunity.  Jim, there is no
    simple answer to that question, Jim.  It's important that we
    re-engineer our supply chain, dialog these issues, focus on
    our core-competencies, liase with ISVs, do whatever it takes,
    get beyond the box, all while reaching a concensus that is both
    acheivable and mission critical.  Thanks for the question,
    Jim."

    (It's important to use the questioner's name, and the phrase
    "that's a good question" -- it shows personal concern; also
    note the use of 'liase' as a verb, a true international
    flavor.)

��IMVHO: I think Bob got off very lightly from the questions and answers
��session on Monday.  He was asked no really hard questions and avoided
    Use of shills?

I had dinner with someone from Galway last night and I got the
impression that Bob had some local honcho paraphrase out sensitive
topics before he actually got to answer them.

>Per

    Banks have lots of Vice Presidents.  Does not necessarily mean you are
    powerful or well paid.  So what exactly is your beef with Digital
    having so many V.P.s   Maybe, since Digital wants to keep these people
    and cannot curently offer them big bucks, they make them a V.P.  Kind
    of an ego boost that does not cost much money.  Could be a real smart
    strategy.
    

How our Q3 looks may not be as important to the stock
prices as the value of the dollar in the world market
and the reaction of the Fed to that situation. I've got
to stop listening to NPR in the morning. This financial
news is depressing. liesl

> How our Q3 looks may not be as important to the stock
> prices as the value of the dollar in the world market
> and the reaction of the Fed to that situation.
    Given our large international sales, a weak dollar should be a plus.
    On the other hand, no nation has ever prospered by trashing its own
    currency. And conversely, a weak currency is no guarantee of prosperity.
    But Treasury keeps trying...
    
      John

Re .137

This is a noble sentiment, but how many of the *new* VPs have come up
through the ranks of Digital and how many have been imported from
other washed up multi-national computer companies who are also
downsizing? 

Re .139

The local honcho you refer to is our local PR man.  He was put in
place to vet questions, so that no questions would be asked that might
leave Bob with the wrong impression of the place [IMHO not a bad
idea - if handled properly].  I went through this process and had my
original question (.136) accepted.  However, this whole process fell
to pieces when Bob actually started the Q and A session as many of the
questions that came from the floor seem to come from people who just
put their hand up :-(. 

Re .140 

Have you ever heard of the term "Too many chiefs, too few indians".
This is the feeling I get when I see our ever increasing number of
VPs. 

Has anyone seen Brian Reid's VP Watch and accompanying cartoon?
Required reading!  It's to be found somewhere in:

http://nsl.pa.dec.com/nsl/people/reid/bio.html .

                          James.

    I find -.1 very interesting.
    
    I have been in a number of meeting where Bob had Q&A at the end of his
    presentation.  Never was there any attempt to enven preview questions
    much less censor them!  I don't think Bob expects that either.
    
    I wonder if the action in -.1 was purely a local initiative?
    
    Peter Dillard

	And again....


	How's Q3 looking? (I know my stock is starting to look pretty
	good)

						mike

    Wait until next Wednesday (19th) and we will all know how Q3 turned
    out.
    
    /Charlotte

    I heard (saw) Palmer on CNBC this morning.
    
    The highlights were
    a.  Population should be reduced to about 60,000 - didn't say when.
        Said the population was currently between 62,000 and 63,000.
        (I thought that was a little interesting - didn't know the 
         number).
    
    b.  He said that analysts expected a profit this quarter.  He didn't
        confirm or deny this.
    
    The announcer's one liner to all of this was - Digital needs to cut
    3,000 more to remain profitable.
    

    
    Analyists are expecting 25 cents a share profit for the quarter.
    I believe we will show a profit due to favorable currency exchange, as
    well as reduced expenses, and most likely a modest growth in revenue.
    I'm predicting 30-35 million profit, but I have no financial figures
    to back this, just a hunch.
    
    Mark

    Re: Note 3742.147 by LASSIE::KIMMEL

�    I heard (saw) Palmer on CNBC this morning.
    
�    The highlights were
�    a.  Population should be reduced to about 60,000 - didn't say when.
                                      ^^
    He did say "to" and not "by", right? ;-}
    
    	BD�

    Yes - "to"
    
    My overall impression of the interview was to try to down play the
    action.
    
    For example, he also stated that he had heard from more than one
    customer that they thought that Digital products were great - but that
    they were reluctant to buy due to the Company's state.
    
    He also said that he was (not exact words here by any stretch) down\
    playing results due to foreign exchange rates - and that he wasn't
    betting on building the business on it.  (this went by rather quickly
    and I"m not sure I'm capturing the flavo - but I think you get the
    idea).
    
    The announcers after the interview complimented him on being so
    candid.
    
    So, what does this say to me about the stock price?  There's a lot
    of gambling going on out there.
    
    

    continued from previous note.....
    
    It says 45 1/4.
    

    Note that the previously scheduled Q3 earnings announcement has been
    moved up to Monday the 17th from Wed. the 19th.  Wish I could remember
    where I saw this, but it was in writing on the tube within the last few
    days...  Probably good news...

    For those that keep asking how does Q3 look, to actually tell you
    before it is made public would be a violation of SEC rules.  Now if you
    would like to go to jail for insider trading, and thus save having to be
    layed off, I'm sure something can be arranged...
    
    SEC is Securities and Exchange Commission for those non-US followers of
    this notes file.

    re: .152....
    
    I believe what you read was a news article or report and that document
    mentioned that the quarterly results would be announced on the 17th.
    
    I would expect that is in error.  We have seen no notice from the
    corporate powers that be indicating a change of date.  I would expect
    to see the results on the 19th.  Not to be a wet blanket...I would love
    to see them on Monday as well, but I think the news reporter got it
    wrong.
    
    Regards,
     
    Tom
    

    
    
    Monday, April 17, is Patriot's Day, which is a legal holiday in
    Massacusetts. As such, Digital employees who work in Massachusetts
    have the day off. Since Digital headquarters is in Mass, I'd be 
    surprised if the earnings were announced then - whoever would be
    doing the announcing should have the day off !
    
    
    Bob

    The date has not been changed.  As part of each quarter's announcement, 
    Investor Relations holds a conference call for financial analysts.  
    These are scheduled weeks, if not months, in advance, and would be 
    nearly impossible to change on short notice.  So count on the 19th.
    
    As a matter of fact, the dates of the quarterly results announcements
    are known a year or more in advance -- they're not hard to guess --
    and would change only under somewhat extraordinary circumstances.
    
    Mac

    
    Not true, the stock going down $1 is no big deal, in fact it has
    gone up alot in the last two-three weeks. 10-13 points or so, it
    can't keep going up a $1 or $2 a day. Bound to drop some, also it
    may rebound before the day is over.

>                        <<< Note 3742.157 by LABC::RU >>>

    
>    I heard DEC stock is down $1 today.  Looks like the
>    Q3 is not good.


DAH! Have ever heard of profit takers? after any rise in the price of a stock
profit takers kick in and do some selling to lock in their profits.
Whats 1 point up or down in a day?

From Livewire 4/19/95

       Digital reports third quarter net income of $74 million (19-Apr)
  

         Digital today reported net income of $74 million, or $.44 per
     common share, for the third quarter which ended April 1, 1995, compared
     with a net loss of $183 million, or $1.34 per common share, for the
     same period last year.

         Total operating revenues for the quarter were $3.5 billion, up 6
     percent from the $3.3 billion reported for the comparable quarter a
     year ago.

         Gross margin for the quarter was 32.2 percent, compared with 33.8
     percent for the comparable period a year ago.
         Total operating expenses decreased to $1.029 billion from $1.272
     billion, or 19 percent, compared with the same period last year.

         The balance sheet continued to strengthen as Digital ended the
     quarter with $1.465 billion in cash, an increase of $201 million, or 16
     percent, compared with a year ago.

         The Corporation completed the quarter with approximately 63,100
     employees -- a reduction of 22,600 positions, or 26 percent, since the
     same period last year.

       Robert B. Palmer, president and chief executive officer said,
     "Digital has taken another significant step forward.  We have recorded
     order rate growth for the fifth consecutive quarter, and revenue
     growth, year over year, for the fourth consecutive quarter. In the
     March quarter, we continued to demonstrate excellent progress in
     implementing our recovery program, particularly in our core systems
     business."

         Product revenues were up 12 percent in the quarter to $1.961
     billion from $1.750 billion in the third quarter of the previous year.
     This represents the fourth consecutive quarter of year-over-year
     product revenue growth. Service revenues were $1.506 billion, compared
    with the $1.509 billion reported in the similar period last year.

         "Without question, Digital's product and service offerings are the
     strongest ever," Palmer said. "We are gaining market share in our
     strategic markets."

         Palmer said demand for Digital's industry-leading 64-bit Alpha
     systems, personal computer systems, network hardware and software
     products and storage subsystems was strong during the quarter.

         Digital, Palmer said, recently has shipped its 100,000th Alpha
     system, with total product and service revenues from the Alpha systems
     family surpassing $3 billion since its introduction.  He said the
     company sees continued strong demand for its Alpha products and expects
     to reach the $4.5 billion mark in total Alpha product and service
     revenues before its major competitors ship their first 64-bit system.


         Last week, Digital unveiled the computer industry's most powerful
     server systems aimed at large commercial and scientific applications.
     The new AlphaServer 8400 enterprise server and AlphaServer 8200
     departmental server are the first to use Digital's record-breaking
     billion instructions per second 21164 Alpha microprocessor. The 64-bit
     technology enables businesses to run some database applications up to
     200 times faster than on current 32-bit enterprise systems.
            Alpha product revenues grew by 66 percent over the prior year,
     driven by strong demand for AlphaServer products and systems running
     Digital UNIX, Palmer said. Growth in personal computer product revenues
     continued to be among the industry leaders at approximately 60 percent
     over the same period last year.

         Adjusting for divested businesses, Digital achieved revenue growth
     in both its domestic and international markets, including very strong
     growth in its Asia/Pacific operations.

         Product gross margin was 28.7 percent, compared with 30.5 percent
     in the second quarter of fiscal 1995 and 30.8 percent in the third
         quarter of 1994. The decline in product gross margin from the second
     quarter is the result of a change in product mix. Service gross margin
     was 36.7 percent compared with 36.1 percent in the second quarter of
     fiscal 1995 and 37.3 percent in the comparable period last year.

         "A weakened U.S. dollar in a number of countries created a slightly
     positive impact on revenue for the quarter," said Vincent J. Mullarkey,
     vice president and chief financial officer. "Non-dollar denominated
     costs and competitive responses, however, substantially offset the
     positive impact.
 
         "Digital generated positive cash flow from operations this
     quarter," Mullarkey continued. "We are continuing with our programs to
     improve gross margins, reduce operating expenses, improve asset
     management and fund our restructuring activities from operations."

         During the quarter, Digital continued to receive awards for its
     products and services.

         "Service News" awarded Digital its prestigious Innovations in
     Service Award for PC Utility  -- a complete desktop personal computer
     management service.
         
      Digital also took six out of 10 AIM Technology "Hot Iron Awards"
     for price/performance in its 64-bit server, workstation and Intel-based
     PC products. In addition, the AlphaServer 2100 was named the best
     server of the year by the readers and editors of "Datamation."

         During the quarter, Digital announced 10 new powerful Pentium-based
     models in its Celebris and Celebris XL families of business desktop
     systems, along with eight new all-Pentium Starion consumer desktop
     models. The company also unveiled a new entry-level Alpha workstation
     -- the AlphaStation 200 4/100.


     Consolidated Statements of Operations (unaudited)
     (in thousands except per share data)
                                                 Three months ended

                                         April 1, 1995     April 2, 1994

     Product sales                          $1,961,450        $1,749,621
     Service and other revenues              1,506,014         1,509,168
     Total operating revenues                3,467,464         3,258,789
     Cost of product sales                   1,399,155         1,210,478
     Service and other expense                 953,317           946,800
     Total cost of sales                     2,352,472         2,157,278
                                                              Screen 11 of 20
     Research and engineering                  251,167           316,767
     Selling, general and admin.               777,664           954,903
     Net interest expense                        7,277             7,846
     Income/(loss) before
      income taxes                              78,884          (178,005)
     Provision for income taxes                  5,144             5,301
     Net income/(loss)                          73,740          (183,306)
     Dividend on preferred stock                 8,875             1,775
     Net income/(loss) applicable
      to common stock                       $   64,865        $ (185,081)
     Weighted avg. shares o/s (1)              147,961           137,898
                                                           Screen 12 of 20
     Net income/(loss) applicable
      per common share                      $      .44        $    (1.34)
   Consolidated Statements of Operations (unaudited)
     (in thousands except per share data)
                                                   Nine months ended

                                            April 1, 1995     April 2, 1994

     Product sales                          $   5,484,094        $4,966,549
     Service and other revenues                 4,579,101         4,561,267
     Total operating revenues                  10,063,195         9,527,816
     Cost of product sales                      3,930,101         3,304,185
     Service and other expense                  2,927,025         2,859,150
     Total cost of sales                        6,857,126         6,163,335
   Research and engineering                     787,051           962,432
     Selling, general and admin.                2,483,188         2,735,798
     Net interest expense                          25,078            13,596
     Income/(loss) before income
      taxes and cumulative effect
      of changes in accounting
      principles                                 (89,248)          (347,345)
     Provision for income taxes                    13,203            11,332
     Income/(loss) before cumulative
      effect of changes in accounting
      principles                                 (102,451)         (358,677)
     (Benefit)/charge due to
    cumulative effect of changes
      in accounting principles                    (64,503)           51,026
     Net income/(loss)                            (37,948)         (409,703)
     Dividends on preferred stock                  26,625             1,775
     Net income/(loss) applicable
      to common stock                       $     (64,573)       $ (411,478)
     Weighted avg. shares o/s (1)                 143,984           136,312


     Per common share:
     Income/(loss) applicable before
      cumulative effect of changes
      in accounting principles              $        (.90)       $    (2.64)
   Benefit/(charge) due to cumulative
      effect of changes in accounting
      principles                                      .45              (.38)
     Net income/(loss) applicable
      per common share                      $        (.45)       $    (3.02)

     Note (1): Per common share amounts are calculated based on the weighted
     average number of common shares and common share equivalents
     outstanding during periods of net income, after deducting applicable
     preferred stock dividends.  Per share amounts are calculated based only
     on the weighted average number of common shares outstanding during
     periods of net loss, after deducting applicable preferred stock
     dividends.
   Selected Balance Sheet Data (unaudited) - Q3FY95
     (in thousands except per share data)

     Cash and cash equivalents......................     $   1,464,933
     Accounts receivable, net.......................         3,083,853
     A/R days sales outstanding                                80 days
     Inventories....................................         2,093,705
     Prepaid expenses and deferred income taxes.....           316,050
     Total current assets...........................         6,958,541
     Net property, plant and equipment..............         2,539,423
     Other assets, net..............................           462,086
     Total assets...................................         9,960,050
     Bank loans and current portion of ltd..........            13,304
     Accrued restructuring costs...................            693,907
     Total current liabilities......................         4,441,648
     Noncurrent deferred income taxes...............             4,758
     Long-term debt.................................         1,012,750
     Postretirement and postempoyment benefits......         1,199,666
     Total liabilities..............................         6,658,822
     Stockholders' equity...........................         3,301,228

     Book value per common share....................      $      19.76

    Non U.S. revenues.............................. QTR     2,294,286
                                                             or    66%

                                                     YTD     6,486,277
                                                             or    64%
     Employee population (approximately)............            63,100
      
                
  
            

    
    was about $40 million more than I thought earlier. $.44 cents a share
    was definitely above the low end of the anaylists expectations who
    thought $.25 or so. Wasn't on the high end of $.88, but I'll take it!!
    
    Hopefully, the stock can now start its way towards $50 and more.
    
    Mark

    
    	How is the stock going today?
    
    �A�

    
    at 7:45 am EDT it was trading at 44 3/4 up 1/4 in London.
    CNBC mentioned 44 cents to be well above the expected 28 cents.

Symbol        : DEC          Exchange    : New York Stock Exchange (NYSE)
Description   : DIGITAL EQUIP CORP
Last Traded at: 44.2500      Date/Time   : Apr 19  9:56:01
$ Change      : -0.2500      % Change    : -0.56

Volume        : 331500       # of Trades : 80
Day Low       : 43.6250      Day High    : 44.5000
52 Week Low   : 18.2500      52 Week High: 46.6250

    Query Results
    
    Symbol        : DEC          Exchange    : New York Stock Exchange(NYSE)
    Description   : DIGITAL EQUIP CORP
    Last Traded at: 42.3750      Date/Time   : Apr 19  1:15:05
    $ Change      : -2.1250      % Change    : -4.78
    
    Volume        : 1934300      # of Trades : 452
    Day Low       : 42.2500      Day High    : 44.5000
    52 Week Low   : 18.2500      52 Week High: 46.6250
    
    

    I note with alarm the follow from the q3 results. Am I misinterpreting
    these numbers, or is our cost of sales actually increasing faster then
    our product sales?
    
                                         April 1, 1995     April 2, 1994
    
  Product sales                          $   5,484,094        $4,966,549
  .....
  Cost of product sales                      3,930,101         3,304,185
    
    From these numbers I compute:
    
            Change in product sales:                $517,545,000.
            Change in cost of product sales:        $625,916,000.
    
    Does this really mean that it cost us $626 million dollars to increase
    our product sales by $517 million? If so, this doesn't seem like a good
    trend!
    
    Rich.

    That is due, at least in part, to the transition from traditional
    high-margin products to the brave new world of low margin "high volume"
    products. Or so my previous manager told me when I asked the same
    question last time this happened. 

    .167
    See PRODUCT margin results for Q3.

    RE: .167 by GOLLY::HART

    I don't know what you are complaining about, according to your math, 

    our product sales were         5,484,094,000 
    our cost of product sales were 3,390,101,000
                                   -------------  
    so we have made                2,093,993,000 in Q1-Q3 on hardware 

    Unfortunately things are not so simple.  The cost of product sales
    are the manufacturing cost associated with building our products.
    We also have development, selling and other administrative costs 
    with each product.  Cost of sales have been going up for the past 
    few years because we are producing products that have a lower margin.
    These products include PC's, printers, storageworks devices and even 
    our line of Alpha based systems.

    What I thought was good news from the Q3 report was that "Selling,
    general and admin" when down $177M. from Q3 of FY94.  These are
    the nonproduct related cost of selling. 

    -Bruce
    

    Re: Cost of sales increasing
    
    From personal experience I believe part of the problem is that while we
    have moved to indirect sales channels and lower margins, we are STILL
    doing most of the PRE-SALES efort, since the channels people either
    don't care to learn or aren't able to learn all the intracacies of our
    product sets. This seems to be true in the network space at least.
    
    Debbie
    

    To -1
    While most of what you said re the cost of SELLING might be true, you
    are confusing the cost of selling with the cost of sales. These are two
    very different income statement iteems.

Re .171
We go through this every quarter.  "Cost of product sales" is
what some companies call "cost of goods sold" -- it represents
direct costs such as raw materials and manufacturing labor.

The cost of pre-sales activities is part of "Selling, General,
and Administrative" -- SG&A -- which decreased dramatically
this quarter.  Or perhaps some fraction of it is mis-allocated
as "Servide & other expense" -- which was close to constant.

    Wasn't there a concerted effort in SG&A to down-size and wasn't
    there a general wiping out of req's in SG&A this past quarter?

    Hummmm...1 + 1 = 2 ????

    

    
      I'd just like to know if we'll share in the "SUCCESS SHARING"
    thing that was bantered around in MCS awhile back?
    Awfully quiet on this issue.

    
    ref .175
    
    	The GPD (Great Plains District) will be handing out checks to all
    MCS employees on 18-MAY-1995 at a rate of 1/2% of one's base salary
    for makeing the gates in Q3 for "SUCCESS SHAREING".
    
    	We have "real" job req.'s out to HIRE folks....
    
    	We have the offical form to fillout if we hire back TSFO'd folks..
    
    	Stocks up...
    
    	People are getting PAY raises...
    
    	My boss told me to get on DIAL and find two PENTIUMS'...
    
    	This is not a dream...I'm very awake!!!!!
    
    Regards
    Rick

    re:
>    	We have "real" job req.'s out to HIRE folks....
>    
>    	We have the offical form to fillout if we hire back TSFO'd folks..
    
    In this age of accountability, I hope those responsible for creating
    the need to restaff TFSO'd slots are suitably rewarded.

    re: last few
      Sorry for the misunderstanding on where the "cost of selling" comes
    in to the P&L. Thanks for the clarification
    
    Debbie
    

    re:.170-.175
    Without knowing all of the details, I will make some assumptions
    about the financial results;
    
    SG&A decreases could come from decreasing headcount, less money
    spent on marketing, thinning out the support infrastructure, spending
    less on office supplies, etc.  All things that probably should have
    been done, however, they do nothing to strengthen the fundamental
    capabilities of the business to grow profitably.
    
    COGS increases could come from increased inventory (we only saw
    this years inventory, what change from last year?), lower inventory
    turnover, decreased quality, inventory devaluation, increased shipping
    costs, etc.  If these are true, it demonstrates a weakening of the
    control over the cost side of the business, and a weakness in 
    business operations fundamentals.
    
    Anybody care to comment?

re .179

>    COGS increases could come from increased inventory (we only saw
>    this years inventory, what change from last year?), lower inventory
>    turnover, decreased quality, inventory devaluation, increased shipping
>    costs, etc.  If these are true, it demonstrates a weakening of the
>    control over the cost side of the business, and a weakness in 
>    business operations fundamentals.
    
this is only partly true.  COGS stands for cost of goods SOLD.
if it is in inventory, it is not sold.  if the inventory increased so much 
that extra space had to be rented, then it might contribute to the COGS.
the "might" is because in some accounting systems costs stop accumulating
when the product goes into inventory. i have no idea how dec handles it.

the inventory is on the balance sheet; COGS is on the P&L.

you are right on about quality. poor quality means more rework and more cost.
there should be a chargeback to manufacturing for DOAs, missing parts, etc.
again, i have no idea if dec does it this way, or if quality is going up or
down.

this is a simplification, but still close to the truth:
manufacturing has costs. everybody else has expenses.