Iomega, A pair-of-dimes, and a foolish conviction....
Many folks have questioned the market values of Iomega and how
much higher it will/can go...
My answer is IOMG share is currently very cheap and it will go much
much higher during the next several years. I have been saying this for a
while, and I am certainly guilty of being very bullish on IOMG.
My answer may only make sense to folks who understand what a
"paradigm shift" means.
Only several years ago, whenever I asked "Anyone here has a paradigm?"
during meetings, common answers would be like "Got no dimes, only
quarters and nickles." Or "Why do you need a pair of dimes? Can you use
quarters?" Most people don't understand what a paradigm shift is and
the typically huge impacts it can make overnight on people/market/society.
The best example for a paradigm shift came from the wrist watch industry
only a decade ago or so. Back then, the Swiss watch industry dominated
the entire worldwide watch market with essentially a total monopoly. No one
else in the world can compete with the quality of mechanical watches and
time pieces from Switzerland. Watch making was the No. 1 Swiss industry.
Of course, the Swiss had dominated the worldwide watch and time-piece
industry for many many years up till then.
Then came the electronic watches. In the span of only 1-2 years, these
new devices nearly wiped out the entire market of mechanical watches, as
consumers found them to be neat, cheap, and having many useful features --
vs. the primarily decorative function of mechanical watches. The entire
world-monopolized Swiss watch industry was basically wiped out overnight.
A major paradigm shift had occurred, as consumers unpredictably showed much
higher preferences for electronic watches than mechanical watches -- just the
opposite of what the "experts" in the industry were predicting based upon, guess
what, their historical understandings of the watch market.
The Swiss companies were the first inventors of electronic watches many years
ealier. However, based on their total success and monopoly on mechanical watches,
they had a major paradigm toward mechanical watches and didn't bother to develop
and market electronic watches to find out whether consumers want them or not.
Of course, they were caught completely by surprise and way behind the curve
when electronic watches became a huge hit overnight with worldwide consumers.
I can clearly see the parallel between the watch industry and the data storage
industry. The Zip and Jaz have clearly brought a major paradigm shift to the huge
worldwide data storage industry. For many years, the data storage industry has
remained essentially the same - harddisks, 5.25 and 3.5 floppies, CDROM, and
boring tape drives. Bigger and faster harddisks have enabled many major new
improvements - bigger software, more data storage. Faster and cheaper CDROM
came to enable and dominate software distributions. However, the harddisks, CDROM,
and 3.5-in floppies have all reached their maximum usefulness. They no longer can
keep up with consumers 's wide range of data storage needs or enable new applications.
Enter the Zip and Jaz! Excellent technologies with the best price/performance and
no competitions. The Zip and Jaz together not only will replace the 3.5 floppy and
take away a big chunk of the harddisk, CD-ROM, and tape drive markets, this
"Z&J twin" will also open up entirely new markets and enabled many new uses for
removable storage media. Like the watch industry, the huge worldwide data storage
industry will be changed overnight and forever by the Zip and Jaz.
What is most exciting about IOMG is that it is the only company in the data storage
industry that stands to benefit from this huge paradigm shift. All other players the like
of Seagate, Western Digital, Quantum stand to lose big time next 1-2-3 years as the
market for harddisks will shrink and the removable drives/disks will explode. These
folks, who have dominated the data storage industry for many years, have been
caught completely off guard by the paradigm shift and probably will not have enough
time to recover or re-establish their dominances next 1-2 years.
I can not imagine how much bigger Iomega will get from here and try not to put a
limit on their growth potential. I just know that they will get much bigger than most
folks have even imagined. That 's what a paradigm shift is all about.
Young Nguyen |
