CONTACTS 

SUBJECTS
SDS, Marketing, Market Potential
Evaluate existing condition
Disillusioned by Technology
Computers Make Buyers Effective
False Promises Computers Do Not Improve Management Productivity
Operating System People Organizations KM SDS Enterprise Management
Killer Application to Use Processing Power to Sustain Inflated Expect
Dream Computer Executives, Managers, Asilomar Conference

1810 -    ..
1811 - Summary/Objective
1812 -
181201 - Follow up ref SDS 11 0000.
181202 -
181203 - Two stock market analysts were interviewed last night on the CNN
181204 - program "Inside Business."  Their analysis of the personal computer
181205 - market seems to support considerations at Intel last month,
181206 - ref SDS 13 2905, and new information from subsequent professional
181207 - events discussing technology, productivity and market opportunities.
181208 -
181209 -    [On 951023 submitted letter to Dale Ames, asking about investor
181210 -    worries that computers are not productive, need Killer Application
181211 -    to sustain market demand for sales. ref SDS 17 0001
181212 -
181213 -    [On 951026 Dale Ames reports investors not worried computer market
181214 -    may be unable to sustain market demand in light of inability to
181215 -    provide productive applications. ref SDS 18 0001
181216 -
181217 -    [On 951107 Intel and Microsoft investing in research to "fix"
181218 -    personal computer for making people productive. ref SDS 20 0001
181219 -
181220 -    [On 960117 Dale Ames reports investors worried computer market
181221 -    needs Killer application to sustain market demand for computers to
181222 -    improve productivity. ref SDS 23 0001
181223 -
181224 -
181225 -  ..
1813 -
1814 -
1815 - Analysis
1816 -
181601 -  ..
181602 - Killer Application Needed to Meet Demand for Better Productivity
181603 - Strong Sales Shows Demand for Better Productivity - Killer Application
181604 -
181605 - Mark Stahlman with New Media Associates in New York city reported that
181606 - investors are worried Intel and Microsoft are significantly overpriced
181607 - based on hope that the personal computer market will continue to grow.
181608 - He said Intel is selling at 20:1 and Microsoft is selling at 30:1.
181609 - Mr. Stahlman said these price earnings ratios far exceed sound
181610 - investment practice.
181611 -
181612 -      [On 960117 Intel needs Killer Application that makes computers
181613 -      useful for improving productivity in order to sustain Intel's
181614 -      markets, explained in analysis by Alex, Brown. ref SDS 23 5840
181615 - ..
181616 - Prices have been bid up based on strong sales of personal
181617 - computers and hopes of continued sales growth.  These hopes reflect
181618 - strong demand for personal computers to improve productivity and
181619 - earnings discussed with Morris on 951011, ref SDS 16 1341, and
181620 - generally summarized as need for a Killer Application reviewed on
181621 - 940615. ref SDS 5 3001 and on 940121. ref SDS 4 6301
181622 -
181623 -
181624 -
181625 -  ..
181626 - Inflated Expectations Caused Inflated Sales of Computers
181627 - Poor Productivity/Usefulness Will Collapse Market for Computer Sales
181628 -
181629 - Investors fear that inflated prices are a "bubble" that will burst
181630 - because Users are discovering personal computers are not as useful as
181631 - expected, reviewed at Intel on 950927, ref SDS 13 6493, and showing
181632 - decline in use of computers. ref SDS 13 7732  Tom Landauer's book,
181633 - "The Trouble with Computers," explains computers are used frivously,
181634 - reviewed on 950710. ref SDS 12 1222
181635 - ..
181636 - Stahlman says stock prices have been inflated by years of
181637 - inflated expectations due to oversold benefits for Microsoft Windows,
181638 - handwriting recognition, handheld devices (e.g., Wizard), CD ROM,
181639 - LANs, software bundling with productivity titles like "Office" and
181640 - "Suite," and now the Information Highway that summarizes hopes for the
181641 - Internet to improve productivity, per meeting with Intel on 950927.
181642 - ref SDS 13 464N
181643 -
181644 - On 890809 analysis indicated stock prices will decline for technology
181645 - that fails to improve productivity, but is merely easy to learn and
181646 - use. ref SDS 1 2U4F
181647 -
181648 - Lack of usefulness is evident from failure by top executives to use
181649 - personal computers, because applications do not improve management,
181650 - analysed on 940615, ref SDS 5 3333, reviewing need for "Killer
181651 - Application," ref SDS 5 3001, originally defined on 940121.
181652 - ref SDS 4 6301
181653 - ..
181654 - On 950504 PG&E planned to rely on Microsoft Windows to improve
181655 - productivity. ref SDS 9 X95J
181656 -
181657 -      [On 951107 Intel's IAL unit formed to improve usefulness of
181658 -      technology. ref SDS 20 2241
181659 -
181660 -      [On 951228 technology executive reports manufacturers are selling
181661 -      computers for entertainment, usefulness is not a marketing
181662 -      advantage. ref SDS 21 3883
181663 -
181664 -      [On 960103 Intel's IAl unit reengineered unable to support
181665 -      research for making computers useful to management. ref SDS 22
181666 -      3884
181667 -
181668 -      [On 960103 proposal Intel develop "dream computer" for improving
181669 -      management productivity at Asilomar Conference. ref SDS 22 4490
181670 -
181671 -      [On 960117 Intel needs Killer Application that makes computers
181672 -      useful for improving productivity in order to sustain Intel's
181673 -      markets, explained in analysis by Alex, Brown. ref SDS 23 5840
181674 -
181675 -      [On 960312 Intel "belt tightening." ref SDS 24 2311
181676 -
181677 -      [On 960712 Intel reported during professional conference at
181678 -      Asilomar that computers do not improve management productivity.
181679 -      ref SDS 25 1552
181680 -
181681 -      [On 980613 expectations of Internet, email for paperless office
181682 -      failed to improve productivity, causes information overload
181683 -      without Killer App of SDS to create knowledge. ref SDS 26 3499
181684 -
181685 -      [On 990713 Intel investment managers reported useful technology
181686 -      for adding intelligence to management is funny and alien because
181687 -      life is wonderful at Intel. ref SDS 27 1767
181688 -
181689 -
181690 -  ..
181691 - Disillusioned by Technology Puts Market at Risk
181692 -
181693 - Investors worry that customers are becoming jaded about buying more
181694 - personal computers.  This worry was reviewed with Intel on 950927....
181695 -
181696 -        Killer App Needed - Taking Quantum Leap........ ref SDS 13 2742
181697 -        Computers must improve productivity............ ref SDS 13 4408
181698 -        Computer demand will decline................... ref SDS 13 6493
181699 -        Planning to grow demand for computers.......... ref SDS 13 8226
181700 -        Intel gave up using computers for management... ref SDS 13 7732
181701 -        False promises paperless office................ ref SDS 13 QG6N
181702 -
181703 - Some investors expect a downward adjustment of stock prices to more
181704 - closely reflect the modest contribution personal computers make in
181705 - productivity and earnings.  Mr. Stahlman cited recent sharp decline in
181706 - IBM's stock price and DEC's difficulties evidence of investor worries,
181707 - ref SDS 15 line 80, ref SDS 14 line 273.  The market is urging
181708 - investors to support efforts that return real value to the customer.
181709 - This means making personal computers that improve productivity and
181710 - earnings. That is what people want, ref SDS 13 line 391, and
181711 - ref SDS 16 line 342.  So far, however, investors are ignoring the
181712 - market, hoping reality will not come calling, ref SDS 14 line 352 and
181713 - ref SDS 15 line 193.  Mr. Stahlman noted this hope has never been
181714 - successful.
181715 -
181716 -      [On 951228 manufacturer's design objectives provide entertaining
181717 -      rather than more productive technology. ref SDS 21 2222
181718 -
181719 -      [On 001207 market forces catch up with PC industry, leading to
181720 -      economic recession. ref SDS 28 V54M and ref SDS 28 MZ7G
181721 -
181722 -
181723 -  ..
181724 - One More Round at Bar of False Hope and Failed Promises for High Tech
181725 - Market Psychology Sustains Sales
181726 - Computers Make People Effective (Smarter, Faster)
181727 -
181728 - Market psychology is sustaining Microsoft and Intel for the time
181729 - being, rather than demonstrable improvement in productivity.
181730 -
181731 - On 950710 Landauer identifies a core biological drive for effectance
181732 - that people hope computers satisfy. ref SDS 12 0738  People want to be
181733 - part of high technology, ref SDS 12 4334; computers sound futuristic,
181734 - intelligent and productive. ref SDS 12 5511  So, people are buying one
181735 - more round at the "bar of false expectations" hoping Windows 95 and
181736 - the Internet will make computers useful for daily management, reviewed
181737 - at Intel on 950927. ref SDS 13 4408
181738 - ..
181739 - Based on past performance, and the underlying difficulty of
181740 - making personal computers useful for aiding human thinking, i.e.,
181741 - intelligence, discussed by Tom Landauer in his book "The Trouble with
181742 - Computers," ref SDS 12 0747, and ref SDS 12 3375, this round of
181743 - investment will be no more successful in improving productivity and
181744 - earnings than were prior offerings.  It will, however, provide another
181745 - year of psychological energy to the personal computer mystique while
181746 - people figure out these latest offerings are empty promises, per
181747 - meeting at Intel on 950927. ref SDS 13 4839
181748 -
181749 -      [On 951228 manufacturers design to provide entertainment, not
181750 -      productive automation, ref SDS 21 3883
181751 -
181752 -
181753 -  ..
181754 - Opportunity - Operating System for People & Organizations
181755 -
181756 - This offers a "window" of opportunity to make personal computers more
181757 - useful so there is a valid reason to buy them.  If that effort fails,
181758 - the bubble will burst, ref SDS 13 line 525.  Ideas to accomplish this
181759 - objective were discussed with IBM at ref SDS 6 line 114, and more
181760 - recently with Intel, ref SDS 13 line 541.  A year after discussions
181761 - with IBM, they spent $3.5B to get Lotus Notes, ref SDS 10 line 51, for
181762 - the reasons at ref SDS 15 line 370.  This buys them a little more time
181763 - to figure out that its personal computer products do not improve
181764 - productivity any more than do Microsoft's.  Intel seems painfully
181765 - aware of this fact, ref SDS 13 line 507.  How will the players
181766 - respond?
181767 -
181768 -    [See later reports of companies hiring psychologists to deal with
181769 -    frustrations of miscommunications, ref SDS 19 line 104.]
181770 -
181771 -
181772 -
181773 -
181774 -
181775 -
181776 -
181777 -
181778 -
1818 -