Thursday, March 23, 2006

Barron's Online - Dell Acquisition May Alienate Intel

"YESTERDAY, DELL ANNOUNCED ITS INTENT to buy Alienware, a privately held computer manufacturer focused on the high-performance consumer PC segment. Alienware shipped roughly 34,000 PCs in 2005, or less than 1% of the PC end market.
?We analyzed the product profile of Alienware's current offerings and estimate Intel processors are used in roughly 60% to 70% of its products, with the remainder utilizing Advanced Micro Devices processors. We believe Intel supplies processors to over 80% of Alienware's notebook lineup and AMD processors are used in roughly 50% of its desktop/workstation products.
We believe this a positive signal for AMD, as it marks the first official use by Dell (or a subsidiary) of AMD processors in its PC portfolio. While Dell has stated the existing management team at Alienware will remain in place and manage its own products, we believe it is possible that AMD processors could end up in Dell machines."

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