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Is Next Finally Zeroing In On The Right Target?


Information Processing

IS NEXT FINALLY ZEROING IN ON THE RIGHT TARGET?

Steven P. Jobs sure has changed. For starters, Silicon Valley's most-eligible bachelor got married on Mar. 18. And the NeXT chief executive, equally famous for his pride as for his technical smarts, has been admitting lately that he has made some mistakes with NeXT Computer Inc., his six-year-old startup.

"We were actually pretty lost in terms of who we were as a company until six or seven months ago," Jobs says. Indeed, last year, NeXT sold just 11,000 workstations, grabbing a mere 2.9% of the market, estimates market researcher International Data Corp. The problem, Jobs admits, was that it took his company too long to come up with the right mix of technology, distribution, and marketing. Now, Jobs says, he's got it right. This month, he has been briefing analysts about a new marketing plan that adds commercial computing customers to his target markets of university students and software developers. The move follows last fall's revamp of the NeXT computers. Then, the company added more power to the machines and slashed prices on some nearly in half, to $5,000.

To reach commercial customers, NeXT has doubled its sales force to 150 people. And by the end of 1991, Jobs plans to enlist 100 "value-added resellers" and 100 dealers across the U. S. They will supplement sales by the Businessland Inc. chain, which lost its exclusive deal to sell NeXT workstations last fall after it failed to push the machines aggressively enough.

REVAMPED. But NeXT faces impressive competition in the commercial workstation arena from Sun Microsystems, Hewlett-Packard, IBM, and Digital Equipment. Together, these companies already own 80% of the market, and they have far more influence with corporate buyers than NeXT.

Jobs claims his technological revamping has already paid off. He says the privately held company sold 8,000 machines during this year's first quarter. Most analysts now figure NeXT's sales could reach 36,000 units in 1991.

The handful of commercial buyers who have already bought NeXT machines say they're impressed, especially by its "user-friendly" software. "You can't put a box on someone's desk that they'll like more than the NeXT," says Hadar Pedhazur, equities technology manager at UBS Securities Inc., which owns 14 NeXT workstations. Now, all the newlywed Jobs has to do is court several thousand more corporate sweethearts.Barbara Buell in Redwood City, Calif.


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