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January 2003

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Subject:
From:
Joe Fjelstad <[log in to unmask]>
Reply To:
TechNet E-Mail Forum.
Date:
Thu, 2 Jan 2003 16:21:07 EST
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Hi  Rudy,

Interesting comments.

If you think about what has happened over the last decade or so, one can see
that the PCB has been reduced to a commodity even though each one is custom.
A "custom commodity" now there is an oxymoron for you...;-)

With most OEMs, it seems that buyers are rewarded (or at least historically
have been) for getting the best price, not the best value.

Seems also that the OEMs have done much to create this mentality. As soon as
they gave up manufacturing and turned to outside, they began to demand price
cuts from folks who spent money on the R&D to develop technologies that they
(the OEM) used to have to spend.

The producer/developer had obviously hoped to hold the line on price for a
while with the product and thus recoup some of that development cost. If the
producer balked, the OEM simply transferred the technological knowledge,
(which they felt they owned), to the next lower tier on the food chain. Not
having any R&D to recoup, the next guy in line would immediately make it for
less. I have heard variations on this story several times from different
folks over the last 6-7 years with household names in the role of the
villain.

Seems like now that some of the seeds of ruin many OEMs have sowed are now
taking root. If one does not treat their vendors ethically, why should they
expect them to act ethically in return?

I am not condoning the actions of the wayward vendors but it seems clear
where they got at least some of their lessons in business ethics.

All the best in the new year.

Peace,
Joe

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