Conference 7.286::digital

    Bob and me need a raise. 

    re:  .0
    
    
    Probably to replenish the cash reserves after funding TFSO.
    
    /Bob

    Re .0
    
    Probably going to issue PREFERRED STOCK. The company must be running
    out of CASH again. Contrary to the horsefuey spouted in the commentary
    on the Q2 results emphasising the uninteresting fact that q2 operations
    genererated cash.
    
    My guess as to why securities are being offered (preferred stock) as
    against another dose of debt is that Wall Street has a pretty poor
    opinion of our debt right now.
    
    Expect the preferred stock issue to drive the common stock price even
    lower. Well I voted against allowing the company to issue preferred
    stock...
    
    Dave

    
    My math says that $1B of dilution will yeild about a $22/share
    price..
    
    Jon
    

   I was told that the numbers released last week showed about $1.1B in
   cash reserve.  Did the financials list a cash reserve?  If so, what
   was it?  If it did, and it was around a billion, then why do we need
   cash?

    The Hudson money furnace must be growing dim...
    

    >The Hudson money furnace must be growing dim...
    
    I don't know how we're doing in the workstation market, but the
    articles that I've read in the PC magazines have not been very
    flattering to our AlphaAXP PC 150. The current issue of PC Computing
    compares a new Power PC system against the AlphaAXP PC 150, an NEC Risc
    based PC and one or two others. We came in dead last in most of the
    speed tests. :-(
    
    If we keep this up, then .6 could be right...
    
    Harry
    

    And Datamation just did a lousy review of Windows NT...
    

    **rathole warning** Continue in DECWET::NTXAP 
    
    re: .7  Those test are based on the Alpha being in 286 emulation mode
    	    which is considerable slower than native mode.  I agree the
    	    press info wasn't good but the comparison was biased because
            Intel binaries were used.  One very serious problem *is* the
            lack of 386 emulation.  MicroSoft's decision not to include 386
            emulation on RISC implementations is killing Windows NT sales on
            our Alpha AXP.

    re: .8  The Datamation article was itself flawed.  It was not an
            article on NT as much as it was a rhetorical explanation of why
            NTAS was not *vastly* superior in all aspects as compared with
            NetWare.  It took on the premise that NTAS was a Novell killer 
            and then disputed it.  If the premise were simply NTAS vs. Novell,
            then, as the article demonstrated, there are pros and cons for
            each with the upward/future edge to NTAS.  I agree with you - the
            article *itself* was lousy. 

    RE: .4
    
    Why would stock go down?  If somebody has enough faith in Digital to
    loan us $1 BILLION dollars, why wouldn't that renew our customers
    faith and wall streets, and the stock go up.
    
    Well it sounds good anyway.
    

    >Why would stock go down?  If somebody has enough faith in Digital to
    >loan us $1 BILLION dollars, why wouldn't that renew our customers
    >faith and wall streets, and the stock go up.
    
        Nobody has lent us $1 billion.  We may try to raise the
        money by attempting to sell something (perhaps preferred
        stock) but no one is loaning it to us.
        
        Incidentally, in the last 12 days, our stock value has
        dropped 18%.
        

If you look at the balance sheet you'll find that we 
have $1.1B in "cash and cash equivilants" and $1.0B
in "long term debt". Seems we do owe $1.0B to some
number of folks.

       .9 >  Those test are based on the Alpha being in 286 emulation mode
    	  >  which is considerable slower than native mode.  I agree the
    	  >  press info wasn't good but the comparison was biased because
          >  Intel binaries were used.  One very serious problem *is* the
          >  lack of 386 emulation.  MicroSoft's decision not to include 386
          >  emulation on RISC implementations is killing Windows NT sales on
          >  our Alpha AXP.
    
    Sorry, but ALL the machines tested for this article were RISC based and
    running the same software. Not many folks want a machine that needs
    custom code written for it when off-the-shelf products are available
    for cheap money that runs just fine on a competitors system. :-(
    
    Harry
    

    RE: .12
    
    Yep, and that 1.0B debt was generated real fast...  DEC made a request
    to the SEC to allow DEC to barrow up to 1.0B.  The very day DEC was
    given the go ahead DEC barrowed .250B and then again at the first of
    the next three quarters for a grand total of 1.0B.  DEC used it as fast
    as we could get it.  I'm very concerned that we'll do the same
    again...I saw it coming when they asked us to vote in the preferred
    stock.  I didn't like it then and I don't like it now.  IMHO, we need
    to draw the line in the sand and say "learn to run a business with what
    you have.  Because, every time your given an inch you take the mile and
    don't have a return to show for it.
    
    
    By the way, remember that some of that 1.1B in cash is in non-USA
    accounts.  Many countries have laws that only allow you to take out a
    small percentage of your profits.  They want you to reinvest in their
    country (wise on their part and only the right thing to do really.  I
    hate this raping of third world countries).  Thus, we can't get our
    grubby little hands on some of that cash.  
    
    I just wonder what is going to happen when DEC runs out of little
    tricks to get additional 1.0B's???!!!  But then why would we need to
    barrow more money, when we can generate a positive cash flow and a loss
    at the same time...have your cake and eat it too.
    
    just my 1.0B's worth, (---)

    hmmm the verb is _borrow_, tho' in these days of devaluing worth
    perhaps barrow _is_ more appropriate....%^) 
    
    martin

    My prediction - Preferred stock (and maybe bonds) will be issued with
    convertability to common if the form of the warrants (mentioned in the
    shelf registration notice) in lieu of cash dividends or to enable a
    below market cash dividend/bond interest.  Upshot - Digital gets more
    cheap capital to bolster short-term finances and subsequent cash drain
    will be minimal at most.  Problem - dillution of common shares will
    effectively put a cap on the stock price unless the fortunes of the
    company (ie: revenue -> profits) turn dramatically.  Partial offset -
    convertablility feature will be at significantly higher price (ie: $50
    per share or more) and sufficiently far into the future (3 - 5 years or
    more) to have some present value without undue dillution of common
    shares.  
    
    IMHO - not a bad strategy, except I'm not confident they'll use this
    capital effectively to bolster the long-term revenue
    stream/competitiveness and reduce the ranks of the Party apparatchik
    (ie: intrenched middle - upper middle management) that is suffocating
    this Company.  If they don't, we'll continue to Wangify...

    re: .9
    
    	You miss the point, open up any trade mag and you see Digital 
    pushing Alpha/NT.  Alpha now has many competitors, and NT is not
    perceived as the end-all solution.  We are basing our success on
    a razor-thin margin, highly commodisized (sp) market with an as
    yet unproven operating system.  We will *NOT* make money in this
    space.
    
    Brad.

    re: .17
    
                        <<< Note 2868.17 by CTOAVX::SMITHB >>>
    >       You miss the point, open up any trade mag and you see Digital
    >    pushing Alpha/NT.  Alpha now has many competitors, and NT is not
    >    perceived as the end-all solution.  We are basing our success on
    >    a razor-thin margin, highly commodisized (sp) market with an as
    >    yet unproven operating system.  We will *NOT* make money in this
    >    space.
    
    I have not missed the point.  A reference was made to the Datamation
    article and I responded to that reference.
    
    I am not in Windows NT marketing and am not interested in a rathole
    regarding our marketing/strategic decision.
    
    Since you have strong opinions about this subject and the title of this 
    note is "1 Billion dollars" and not "the Datamation article" I suggest
    you read DECWET::NTAXP 224.0 and reply there.