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Technology Stocks : Disk Drive Sector Discussion Forum

WDC 171.38

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10:59 AM EST

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To: Z Analyzer who wrote (5011)	11/23/1998 3:30:00 PM
From: Mark Oliver	Read Replies (1) of 9256

<To me, it is not insignificant that none of HTCH's competitors have yet been able to qualify a wireless suspension during a time when some drives are literally not being produced due to lack of them. Nor that all their competitors have programs to develop wireless suspensions using TSA flexures purchased from HTCH.> Fujitsu uses CAPS, exclusively. This is a proven, and perhaps expensive technology which surely competes with Hutchinson's TSA. Fujitsu is liscensing this technology to Magnecomp and they intend to produce it in China. They also buy TSA flexures as you say because they only care about selling what the customer needs as long as they can make money. They will convert customers at any opportunity. Then you also have CIS produced by Nitto Denko and sold in conjunction with NHK. This product is going into Quantum drives and I would suggest that it could be a (distant) second source for nearly all TSA programs. And then you have Innovex and 3M selling into Seagate. I don't know what other companies 3M sells to. Of course, we can continue the merits discussion of TSA vs a flex circuit, but it's pointless. I agree that Hutch has the product of choice, and the only thing holding them back is ability to ramp production which is improved. Anyway, it is untrue that competitors are unable to qualify from what I've been able to gather. Second, I believe the one thing we can agree on is that PC sales will not be normal over the next 18 months. That could be favorable or not, I don't know. I've been asking this question for the last year and nobody has the same answer. So, I think the market in general is at risk and that makes me nervous. Probably HTCH could trade to 45, but I don't see it as an undervalued no-brainer. I wait for another leg down and hope I'll be brave enough to buy it. Regards, Mark

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