Disk Drive Sector Discussion Forum Message Board

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Technology Stocks : Disk Drive Sector Discussion Forum

WDC 163.33

+3.5%

Nov 28 9:30 AM EST

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To: La Traguhs who wrote (6984)	8/20/1999 2:15:00 AM
From: Mark Madden	Read Replies (2) of 9256

It is great hearing your valued comments. IMO Steve Luczo made his comments for the benefit of competitors and the bankers. $100 million in price cuts will damage competitors for a quarter but these companies will survive as wounded animals to destroy future profits. With the short economic lives of todays drives, larger companies will see opportunity in the next generation of drives to salvage weakened companies. The large companies will use knowledge from the weakened DD companies with new cash to build cost competitive manufacturing. Buying companies gives SEG the opportunity to control the employees, the strategies, and the pricing. We have noted that SEG is accumulating large sums of cash they don't need in the present environment. They are planning something big. They could be planning something in the software segment that will completely surprise us but their past comments indicate they feel the DD industry is undervalued. IMO they are planning major purchases of their own stock or purchasing control of other companies to give them more control in pricing. The assets could give them new lines of customers, give them experienced employees and manufacturing capacity to help meet the future demand they see. Either tact will benefit SEG stockholders. I'm sure the next three months will surprise us with major strategy changes. Given the recent comments on 3rd quarter (calander) losses and selling drives for under cost I welcome any news of change. All DD companies are under tremendous pressure to change the present situation. We should all be better off in January. Mark M.

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