Path: utzoo!utgpu!news-server.csri.toronto.edu!cs.utexas.edu!sdd.hp.com!uakari.primate.wisc.edu!zazen!news
From: anderson@macc.wisc.edu (Jess Anderson)
Newsgroups: comp.sys.next
Subject: Re: Bogus Financing
Message-ID: <1991Feb10.050226.16434@macc.wisc.edu>
Date: 10 Feb 91 05:02:26 GMT
References: <4065@orbit.cts.com>
Sender: news@macc.wisc.edu (USENET News System)
Organization: Madison Academic Computing Center, UW-Madison
Lines: 66


In article <4065@orbit.cts.com> reichard@pnet51.orb.mn.org
(Kevin Reichard) writes:

>anderson@dogie.macc.wisc.edu (Jess Anderson) writes:

[re whether NeXT should be in the banking business]

>>Our credit union will finance computer purchases by faculty,
>>students, and staff.  I think other institutions of higher
>>learning have similar arrangements.  I think NeXT has its
>>hands full enough without setting up a financing arm at this
>>point.

>The UW Credit Union's interest rate two years ago was 16
>percent, while the credit union I used (CUNA) was 14
>percent. A 16 percent interest rate ain't that good a deal,
>Jess--on the educational end, IBM's new financing rate is
>under 10 percent, while Apple's old financing rate was
>around 8.

And how do IBM's and Apple's gross sales compare to
NeXT's?  Banking is a tough business, one that needs lots
of liquidity.

I bought a car at 9% three years ago through the UW Credit
Union, but that's not really the point.  A person can (and
should) always shop for credit, and credit unions are not
the cheapest commercial sources of around (banks are).	But
how good the deal is, I think, is really a measure of what
one is willing to do -- the harsh reality is: what you want,
you gotta pay for.

If NeXT decided to become a bank, on top of all their other
problems, they'd need another giant influx of cash to
capitalize the venture, and they'd need a way to write off
loans that turned into bad debt.  That would mean higher
computer prices.

I think NeXT should stay with what it does best: building
computers.  And there's no such thing as a low enough price:
you could give them away and people would still be wanting
you to lower the price.

In terms of financing, buying a computer is not much
different from buying anything else.  You shop around for
the money and you pay the going rates (they're coming down
lately, too).

>There's very little hassle with setting up a financing
>arm -- look at the early Apple (a Steve Jobs' project, no
>less!) for a classic lesson on infiltrating society through
>the universities.

We evidently have a different idea of what size hassle it
is.  Times have changed quite a bit since "early Apple."  If
financing NeXT customers were such a hot idea, somebody
would probably be doing it by now.

<> Old age is the most unexpected of all the things that
<> happen to a man. -- Leon Trotsky
--
Jess Anderson <> Madison Academic Computing Center <> University of Wisconsin
Internet: anderson@macc.wisc.edu <-best, UUCP:{}!uwvax!macc.wisc.edu!anderson
NeXTmail w/attachments: anderson@yak.macc.wisc.edu  Bitnet: anderson@wiscmacc
Room 3130 <> 1210 West Dayton Street / Madison WI 53706 <> Phone 608/262-5888