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June 3, 1987

DATA GENERAL SEES NO SIGN OF SIGNIFICANT UPTURN IN ITS KEY MARKETS

By CBR Staff Writer

Sales at Data General Corp continue to be sluggish, the company told Reuters after its communications products launch on Tuesday, and despite rising sales at DEC, the company sees little evidence that demand will pick up in the near future. It says that sales have been moderate to flat – but certainly not down. Analysts say that the minimaker’s early success with its Comprehensive Electronic Office software turned out to be a poisoned chalice because it encouraged the company to lay much more stress on direct sales and to play down its traditional reseller channels. Its success with much more powerful 32-bit machines in the early 1980s galvanised DEC to respond with a comprehensive re-modelling of its VAX line, and Data General’s pitch into large accounts was stopped in its tracks a couple of years ago. The company is now trying to rebuild bridges with its reseller channels, but is criticised for not having enhanced key product families such as the Desktop Generation personal computers and the Data General/One lap-top at a regular or fast enough rate since their announcement. In the meantime, the surge at DEC, coupled with combinations like the one that created Unisys Corp, have widened the gap enormously between the second rank players and those in the third rank.

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