Digital Equipment Corp will see short-term pressure on profits from its growing computer services business as it refocuses sales from minicomputers to lower-priced workstations, the company told Reuters reporter Lori Valigra: the company is offering service on non-DEC products, and reckons it’s a high-growth business it hopes will contribute half of service revenues within three years; Multivendor customer services is a very profitable business unit and it is a major strategic focus for Digital, John Rando, vice-president of the multivendor customer services unit said – but profits will be under pressure over the next three years because of product crossover; still profits will erode at a steady, predictable pace that is very manageable; multivendor customer services revenues declined 11% in fiscal 1994 from 1993 levels, but only 3 percentage points of the decline was due to price differentials, the rest being down to currency translation losses and Euro-acquisitions in Europe; service on alien products now makes up 18% of the total but it is growing at 40% annually.
