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  • Nihon Silicon Graphics to Start Direct Sales to Clients
  • January 19, 1999 (TOKYO) — Nihon Silicon Graphics KK said that it will sell computers direct to large corporate clients, and that the new sales system could begin as early as mid 1999.
    The company established a new Solutions Sales division on Jan. 5. The division will handle direct sales activities, and the new System Integration unit will provide technical support to partners.

    UNIX servers will be the main products to be sold through the direct sales route. UNIX servers produced by Silicon Graphics Inc. (SGI) in the United States, including the Origin series, have high levels of performance. They have built up proven track records as data warehousing servers in markets other than Japan.

    Nihon SGI will form close relationships with major domestic SI partners and sell Origin series products to corporate clients. It decided to focus on boosting sales to large businesses because profits in that area are likely to be higher as compared to relying on indirect sales routes using sales agents.

    Within five years the company hopes to see its domestic sales reach the level of 100 billion yen (US$898 million).

    Up until 1998, about 70 percent of Nihon SGI’s sales in Japan were via indirect channels. Most of the remaining 30 percent in direct sales was accounted for by sales of supercomputer products of the former Cray Research Japan Ltd., which was combined into Nihon SGI in 1996.

    More than half of its indirect sales were made up of workstations.

    Also, Nihon SGI revealed that in mid-February it would launch domestic shipments of new Windows NT workstations. The products were unveiled in the U.S. market by Silicon Graphics Inc. on Jan. 11.

    Prices for a Silicon Graphics 320 Visual Workstation will start at 682,000 yen (US$6,130), for a model equipped with a 350MHz Pentium II microprocessor, 128MB of main memory and a 6GB hard disk drive (HDD). A Silicon Graphics 540 Visual Workstation featuring a 450MHz Pentium II Xeon chip with a secondary cache, a 256MB main memory and a 9GB HDD will be priced at 1,323,000 yen (US$11,900).

    These new Windows NT-based workstations will be offered as products in their own right and their motherboards will be made available for value added resellers (VARs). Also, sales will be promoted by offering discounts to buyers purchasing them as part of a set that includes a server.

    Until now, the company has limited both the total number of workstations it sells and the number of sales agents contracted to sell them in an effort to avoid price reductions that would prevail if the products were available in stores.

    Nihon SGI’s annual sales of workstations in Japan now exceed 10 billion yen. However, another result is that the company has managed to ship only a combined total of around 27,000 machines in Japan.

    Related story: Nihon Silicon Graphics Effects Major Structural Reform

    (BizTech News Dept.)



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