?NAME:Article Applying to MarketingThe article I am writing the essay on ?Is The Tech Out Of Steam?, it can befound on pages 30 – 32 in the March 15, 1999 issue of Business Week. The articlewas about how the demand and profits for the computer industry might beslipping. This opinion began being felt on Feb.
16th when Hewlett-Packard Co. and Dell Computer Corp. announced quarterly results were down. Thatdisappointed Wall Street and their stock prices were punished. Many researchcontinues to point out that this industry might be on its way down, in terms offinancial gain. The industry will always be alive and kicking, but as prices continueto drop, profits will drop as well.
That is a good thing for consumers, but a badthing for businesses. Although the research continues to point out the decline,nobody is predicting this to be a long-term slowdown or a significant fall indemand for high tech gear. Corporate demand for PC’s is dwindling, therefore inorder for companies to sell, they must lower their prices. The price for a top of theline PC continues to drop.
Every time Intel produces a new processor, they freezethe market. When Intel introduced its new Pentium III, they advertised it cheaperthan their previous Pentium II. Consumers seeing that won’t pay top dollar forPC’s anymore. That is one of the main reasons the industry is at a lull.
The onlycompanies that seem to be prospering are those whose main focus is the Internet. Those companies will continue to prosper as the Internet becomes (already is) themain focus of communication. This article can relate to class many different ways. Not only in differentways, but also areas.
The fact that the computer industry profit margin is at a low,is supported by a lot of research. This research is quantitative in that, it is given inpercentages and statistics. For example, A survey for top corporations by marketresearch firm Forrester Research Inc, shows they plan to raise informationtechnology spending by just 1% this year, down from 4% in 1998. Thisquantitative research that is shown throughout the entire article is also primarydata. Unlike the law of diminishing demand which relates to most of the businessworld, the demand for computers is falling, as is the price. The graph on the firstpage on the article clearly shows that the first-quarter PC sales is down halfcompared to 1996.
Then in the article it says the pricing pressure is spreadingwhere sub $1000 PC’s are ruling. Pentium also shows an example of a productline. Their Pentium II and Pentium III processors are only a few in a line of 10 orso. Finally, the last thing that relates to class is how Intel acts as a reference groupand/or group leader to the entire market. It says in the article that when Intelreleases a new processor, the entire market freezes.
That just shows that manycompanies basically stop and watch the Intel product through the market in itsearly stages.Business Reports
