Hughes emerges as desktop integrator

In late 1994 executives at Hughes Data Systems decided to change the company's course.

Instead of focusing on Unix-based reduced instruction-set computing workstations which Hughes had done since its founding in 1990 the firm would pursue the federal PC market and specifically the Defense Department's cornerstone PC deal Desktop V. Hughes Data Systems based the strategic shift on the growing parity of RISC workstation technology and high-end PC products.

"We looked ahead and said by...1998 there is not going to be two entirely separate [RISC workstation and PC] marketplaces " said E.O. Knowles president of Hughes Data Systems. "We decided we'd better learn what the high-volume PC business is all about and go after the best Desktop V."

Two and a half years after the PC decision the company now lays claim to the $1 billion Desktop V contract and a $171 million pact to supply PCs to the Patent and Trademark Office both 1996 awards. And in a bid to further extend its PC reach the company plans to offer hardware through the General Services Administration schedule and provide leasing as an option on all its contracts.

Payton Smith a research analyst at IDC Government Falls Church Va. said Hughes Data Systems appears to be succeeding with its PC push thus far. "They seem to be doing well but especially with Desktop V since Zenith [Data Systems] is having such problems " he said. Hughes Data Systems is currently the only vendor taking orders on Desktop V because the Air Force earlier this month suspended ordering on Zenith's contract.

The federal PC market features high product volumes but also fierce competition. Hughes Data Systems contends with other integrators and resellers as well as hardware manufacturers. While acknowledging the competition Knowles said he believes service provides Hughes Data Systems with a point of differentiation. "The discriminator today is the service the customer receives " Knowles said.

On Desktop V Hughes Data Systems provides the contract-stipulated seven-days-a-week 24-hours-a-day support and free software upgrades for three years. But the company also operates a product showroom in Montgomery Ala. home of the Air Force's Standard Systems Group and two modified Winnebago vans that tour military facilities across the country.

The mobile showrooms exemplify Knowles' strategy of being "responsive to the customer " said R.G. Guilbault vice president of business development for Digital Equipment Corp.'s Federal Government Region. Digital supplies wares to Hughes Data Systems on Desktop V and the Air Force's Workstations I a RISC workstation-oriented pact.

Hughes Data Systems also plans to take on the GSA schedule. Knowles said Hughes Data Systems will offer hardware and software on the schedule which will be established under the Hughes Aircraft Co. umbrella. He said he expects his company's offerings to be available on the schedule by June.

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