Compaq and Digital resellers play the waiting game

Compaq and Digital resellers play the waiting game

Key Digital and Compaq resellers have expressed mixed concerns over the impending merger of the two vendors. On one hand resellers contacted by ARN last week were confident the merger would open up new business opportunities; however, others were worried a combined Compaq/Digital would suffocate the market.

David Hayman, managing director of Integrand Solutions said, should the deal go through, it would be "good news for the market and good news for Integrand".

As Digital's largest integrator, Integrand Solutions stands to gain the most from the possible merger.

"I would say my business is worth more as a company now than before the announcement," Hayman said.

Should the deal gain shareholder approval, the combined entity would potentially be the number two hardware vendor in the market, a prospect that has other vendors shaking in their boots.

"As an integrator, we feel it's much better to deal with a company that's number two rather than number five," Hayman said.

"You only have to look at the way Hewlett-Packard has been running scared with its childish advertisements."

Chris Pappas, managing director of Compaq reseller Dynamic Solutions, said while there would be a lot more resources available for the channel, the issue of market domination by such a large vendor was concerning.

Digital's channels manager, Paul O'Connor, dismissed the comment stating that it is "not an issue". He cited IDC Australia figures that show the top 10 local vendors hold 50 per cent of the market, or just 5 per cent each.

Business Computers of Australia (BCA) is a reseller for both Compaq and Digital. It's marketing manager, Louis Vellios, said he needed to consider product rationalisation closely to avoid the possibility of decreasing the market share the separate companies now enjoy.

Vellios was also concerned that times to market and product availability under a combined vendor would be affected.

But O'Connor countered this concern by saying: "One of the advantages of combining volumes is that it puts us in a preferential position to other companies."

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