Computer makers ship new gear to New York

Computer makers moved quickly to begin replacing equipment lost by their customers in the attacks on the World Trade Center and the Pentagon last week, as their clients began ordering millions of dollars worth of PCs, servers and storage devices.

Estimates for the cost to replace IT equipment begin at US$3.2 billion for the investment community alone, according to one researcher's estimates.

"They lost a lot of PCs, servers, telecommunications equipment," said Larry Tabb, vice president of the securities and investments research practice at the TowerGroup Research Inc. analysis firm in Needham, Massachusetts. Most of the investment firms with destroyed equipment use the larger computer suppliers like Sun Microsystems Inc., Dell Computer Corp., Compaq Computer Corp., Cisco Systems Inc. and the like, he said. "The names that are most common will probably do best."

Most of the immediate calls for equipment relate to computer gear used by people in offices, as most of the companies in the World Trade Center kept big, expensive hardware off-site, he said.

Dell and Compaq were careful to avoid discussing dollar figures for the sales, in part to avoid the appearance of profiteering at the expense of companies tragically facing far greater human losses.

Both Dell and Compaq said that the value of sales related to replacing equipment at the disaster sites would not significantly affect the companies' bottom lines when reporting financial information at quarter's end. Dell earned revenue of $7.6 billion for its second fiscal quarter ending August 3; Compaq earned $8.5 billion in its second quarter ending June 30.

"It's not going to have a material impact on our business this quarter," said Mike Maher, a Dell spokesman. Dell has shipped more than 20,000 workstations, notebooks, desktop PCs and other equipment to customers affected by the terrorist attacks, he said. Phone calls for technical assistance began coming in almost immediately after the attack, Maher said.

Within the first day, Compaq began taking orders. As of Monday, Compaq had shipped 8,000 workstations, 10,000 flat-panel monitors and several thousand servers to companies affected in the attacks, a Compaq spokesman said. "The demand has been staggering ... fortunately we've been able to serve them quickly."

The big computer makers have some experience with previous disaster situations. When powerful storms hit Houston and North Carolina, customers quickly called manufacturers to replace equipment, the Compaq spokesman said. In the hours immediately after the World Trade Center collapsed, Compaq set up an emergency command center to handle incoming disaster recovery calls. "We'd been through the drill before."

Tabb estimated it will take a year or two for companies to recover effectively, as they seek out new office space and rebuild the foundation of their businesses and their lives. And in the short term at least, business isn't high on the priority list for most of them. "It will take time for them to want to go back to work, and to re-engage. That's not just the technology folks, that's everyone."

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George A. Chidi Jr

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