Gil: it is very naive to state that they have little competition in this
arena. They are up against some of the biggest guns in the
industry like Hewlett Packard and Sony who have more experience
with optical. Compatible drives are available from IBM, Sharp,
Fujitsu, and others. Whoever says this is "no competition" is
ignorant of the market. I have been using HP optical since 1991,
and Sony since 1989. Both are now shipping 2.6 GB and will
4.6 on a realistic schedule. The reasons that HP and Sony will
own 4.6 market rather than Pinnacle is as follows:
1. HP and Sony already own the market. Sony and Ricoh
pioneered 650MB media in 1988. Ricoh bailed out when the market
didn't grow as expected, but Sony hung in and HP joined in 1991,
IBM, Sharp and Fujitsu shortly thereafter. 1.3GB media were
introduced circa 1992, and 2.6GB earlier this year.
2. Pinnacle has spent its war chest on ads in expensive
publications advertising a product it could not possibly provide.
3. Optical is not a mass market product and will not be for several
years. Home users prefer Iomega Zip and Jaz rather than optical.
Optical cartridges are big and bulky at 5.25" and the optical drives
use lasers which make them use lots of power and generate
lots of heat. Hold a Zip or Jaz cartridge in one hand and an
optical in the other or try to put them in a shirt pocket, and you
will see what I mean. Chances are you can't even find an
optical disk. Nobody should invest in optical companies unless
they have at least personally seen and tried an optical drive,
and if you are thinking of investing in Pinnacle, hook up
a Sierra to your PC and make up your own mind.
4. The optical drives today are about as fast and reliable as
hard drives were in 1990. When optical drive manufacturers make
reliability statement, they are talking about the media, not the drives.
Optical drives have hot lasers which fail much more easily than hard
drives. I have to regularly repair my optical drives, and always
have spares around. Difference between HP and PNCL is that
HP is honest about this and sells to corporate users who know the
pros and cons of optical and understand how to use it. HP puts
their reputation behind the drive and knows how to service
them when they do fail. They have qualified service personnel
who come on site and repair the drives for free during the
warranty period. Setting up this service network took years
even for HP. Their service was terrible back in the early days,
but it is outstanding now. I don't think that HP has a net profit
from their investment in optical, but they have the deep pockets
to service their customers properly until it does become profitable,
and they already have the confidence of the optical community.
5. When HP or Sony announces a product or a ship date, it is a
reliable date. Pinnacle ship dates are not taken seriously.
That is important to corporate users who plan heavily around
these dates. Just because Microsoft blows their dates and
gets away with it doesn't mean that everyone can or does.
Software is different than hardware.
Invest only risk capital in Pinnacle. They have a new management
team for sure, but this will be no cakewalk. As I explained, there
are lots of big name players in the game already, and in seven
years, the optical market has not grown as expected. Careful with
this one. |
