Disk Drive Sector Discussion Forum Message Board

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Technology Stocks : Disk Drive Sector Discussion Forum

WDC 181.08

+3.5%

Dec 19 9:30 AM EST

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To: Mark Madden who wrote (7308)	11/7/1999 6:46:00 PM
From: T Bowl	Read Replies (2) of 9256

Mark - Is the VL series taking over as the low cost leader? In the last few weeks I've seen the MXTR VL series show up in the channel. Everywhere & every capacity that I track I see it as the lowest priced drive. It's even cheaper than the SEG U4 out there.(I haven't seen the U8 yet.) If I look at a price vs capacity chart for CDW, I see that MXTR is now the LOWEST price drive at EVERY MXTR capacity that they sell. This includes drives that are not the VL series too! This is a serious change from as little as 1 month ago when SEG and QNTM were the leaders. SEG has historically(the past year or so) had the lowest prices everywhere. And everyone has been bitchin' about it forever! I find this most fascinating when I consider comments made by MC during the MXTR CC a few weeks ago. He mentioned a few important pts - 1) MXTR was the only DD maker w\ positive GMs in desktop 2) Aggr price cutting has done NOTHING for anyone as far as market share is concerned. It has only hurt profits. Some Bds out there are starting to question this practice now that it hasn't resulted in any share gains(read: they are starting to question SEG's pricing). These tell me that MXTR is not interested in using price cuts to gain share, in fact they've said repeatedly that they would not do such a thing at the expense of margins. I might be grasping here, but the potential combination of MXTR being the areal density leader as well as the low price producer could prove fatal(hopefully) for some competitors. They've been the bleeding edge leader for some time, but not that the VL series is starting to hit the market full steam. It could also prove to be a big problem for SEG. They ruled the "purpose designed low price" DD arena for quite a while because they were first to market, but have they lost the edge? Do you see the same trends in MXTR pricing? todd

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