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Sun Accused of Killing Secondary Market in Europe

ASCDI is saying Sun is breaking UK competition law and closing the secondary market in Sun products in Europe
By Virtualization News
Article Rating:
May 2, 2007 03:00 PM EDT
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 10,554
ASCDI, the Association of Service and Computer Dealers International, has complained to the Office of Fair Trading in the UK about Sun, saying it’s breaking UK competition law and closing the secondary market in Sun products in Europe to anyone other than Sun by refusing to supply resellers with provenance information on Sun equipment.
 
Sun’s policy went into effect last year and ASCDI claims resellers have had to shift their business to other product lines and are holding large inventories of Sun products that either can’t be sold or can only be sold at a steep discount. One reseller, it said, has been forced out of business.
 
The trade association estimates the market in used Sun products in the European Union to be worth $1.4 billion this year and under normal circumstances, it says, resellers would see a market share of $533 million. “If Sun behavior continues unchecked,” ASCDI says, “not only will this share drop, other manufacturers may follow suit, forcing independent resellers out of the market and giving manufacturers near monopolies for their respective products.”
 
ASCDI says Sun is the only OEM refusing to cough up the information.
 
It wants an order from the authorities that Sun is acting anti-competitively and telling it to provide the information “in a timely manner, without disclosure of such requests to Sun’s direct sales force on a fee-free basis.”
 
Sun took a UK reseller called Amtec to court charged with infringing its trademark for trafficking in a Sun system that was originally sold in Israel and wended its way through several European countries to Britain. Sun has told resellers they can’t sell used equipment that wasn’t made for the territory and need the paperwork to prove it was but won’t give it to them.
 
Sun sued Amtec on the basis of an EU law that says machines can’t be sold without the permission of their trademark holder.
 
Ultimately Sun’s policy has an impact on the worldwide secondary market. See, it seems that 40% of US machines wind up on the European market.
 
Meanwhile, we read in the papers that a two-week 25th anniversary Sun promotion really ticked off resellers because Sun cuts prices on many of its servers, storage, software and service by 50% or better but only for people who buy direct from the company. Its offer was e-mailed to customers including clients of its resellers. The resellers’ scream was reportedly so loud that at press time Sun was scurrying to make changes and cut them in.

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Published May 2, 2007 – Reads 10,554
Copyright © 2007 SYS-CON Media, Inc. — All Rights Reserved.
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SYS-CON's Virtualization News Desk trawls the news sources of the world for the latest details of virtualization technologies, products, and market trends, and provides breaking news updates from the Virtualization Conference & Expo.

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Virtualization News 05/01/07 04:26:58 PM EDT

ASCDI, the Association of Service and Computer Dealers International, has complained to the Office of Fair Trading in the UK about Sun, saying it's breaking UK competition law and closing the secondary market in Sun products in Europe to anyone other than Sun by refusing to supply resellers with provenance information on Sun equipment.