SAN FRANCISCO: Compaq Computer Corp. data storage system sales topped
forecasts in the last six months, an executive vice president said, arguing
customers had not abandoned Compaq despite the uncertainty over its plan to
merge with Hewlett-Packard Co.
Mike Winkler said in an interview that Compaq's sales of data storage devices
were about a third higher than he had expected at the end of last year, with
sales for the six months from September to the middle of March around $900
The bulk of those sales were in the first quarter, which Compaq reports on
April 23, he added. That figure represented a drop from the comparable period a
year earlier, he said, declining to give a figure, but was better than
competitors like EMC Corp. "We are clearly in a share-gaining
position," he said.
Compaq stands to face increased competition from EMC as Dell Computer Corp.,
which took the No. 1 personal computer maker title from Compaq last year, teams
up with Massachusetts-based company.
Winkler said there was tremendous pricing pressure in the storage industry
but said he did not think customers had waited to place orders at the last
minute, in hopes of negotiating major price breaks, as some technology companies
About 40 percent of technology sales are in the last month of a given
quarter, he said. "I don't think this quarter was any more severe or less
severe," he said, referring to the industry as a whole. Analysts are
scrambling to understand whether corporations are spending technology budgets
frozen for a year during the recent economic downturn.
Winkler also said that Compaq's merger with HP had not scared away customers,
and he argued Compaq would improve its product line if the deal would go
through. Compaq's midrange storage products would complement HP's high-end line
based on hardware from Hitachi Data Systems -- also a supplier to HP rival Sun
Microsystems Inc. -- and HP's OpenView management software, he said.