Re: Minutes from Feb 21 LSE Call

Martin J. Bligh
2003-02-22T16:19:52Z

> That's all handwaving and has no meaning without numbers. I could care less
> if Dell has 99.99% margins on their servers, if they only sell $50M of servers
> a quarter that is still less than 10% of their quarterly profit.
>
> So what are the actual *numbers*? Your point makes sense if and only if
> people sell lots of server. I spent a few minutes in google: world wide
> server sales are $40B at the moment. The overwhelming majority of that
> revenue is small servers. Let's say that Dell has 20% of that market,
> that's $2B/quarter. Now let's chop off the 1-2 CPU systems. I'll bet
> you long long odds that that is 90% of their revenue in the server space.
> Supposing that's right, that's $200M/quarter in big iron sales. Out of
> $8000M/quarter.
>
> I'd love to see data which is different than this but you'll have a tough
> time finding it. More and more companies are looking at the cost of
> big iron and deciding it doesn't make sense to spend $20K/CPU when they
> could be spending $1K/CPU. Look at Google, try selling them some big
> iron. Look at Wall Street - abandoning big iron as fast as they can.

But we're talking about linux ... and we're talking about profit, not
revenue. I'd guess that 99% of their desktop sales are for Windows.
And I'd guess they make 100 times as much profit on a big server as they
do on a desktop PC.

Would be nice if someone had real numbers, but I doubt they're published
except in non-free corporate research reports.

M.