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CNET News.com/Meta Group: VA bucking odds in hardware market

Oct 05, 2000, 22:41 (10 Talkback[s])

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"Linux hardware seller VA Linux has an interesting strategy, and its financial grounding in computer hardware sales makes it stand out among the pure Linux companies."

"Ultimately, VA has little to offer beyond lower price to the wider market of corporate buyers looking for Linux Web servers. And the lower its prices, the less margin it makes and therefore the less likely it is to become profitable."

"Linux is finding a place in two markets. Corporations are using Linux for inexpensive Web servers and potentially may expand their Linux use to other non-critical applications."

"Today VA is growing on the basis of selling to Linux "true believers" that it has attracted with the help of its Web sites. That community requires only modest support and is a viable starting point. If VA is to sustain its growth, however, it must invest heavily in marketing and in building a channel, and those investments are likely to eat up any profits it may realize."

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