Stitch, Yogi,
Well, certainly you guys could be right about Fujitsu's motives. They may even like the diving prices, they may be Seagate's partner in all this for all we know. It was, after all, Fujitsu who two years ago surprised everyone with aggressive pricing and aerial density gains to gain share against the then "Big Three" as they were affectionately called by people on this board and in analyst circles. But something odd must be going on with Larry Sanders resigning. Though I don't know him from beans, he oversaw a big expansion in Fujitsu's drive business. I would guess he is an ambitious kind of guy. Unless he is tired of the grind (or has other "personal" reasons), I can't believe he would resign if they were planning a major push forward, surely he would want to be part of that. Fujitsu is a huge diversified company, they are in a lot of capital intensive businesses. They have recently announced that they are cutting down on their DRAM exposure, and retrofitting their factories to focus on producing flash memory. This is sensible for them. It may also be sensible to get out of the crowded desktop arena, and focus on the relatively saner and certainly more lucrative areas of 2.5 inch and enterprise drives. They could be smaller but more profitable. And, if recent projections that I have read are true, even the desktop may move to the 2.5 inch form factor in a few years, so this would be a way of focusing on the future.
All high speculative. May be mush.
s.
EDIT:
One more thing, speaking of refocusing and shifting investments: I sure am glad that I shifted money out of this sector and into the ECM sector last year. The only real regret I have is that I didn't just put all of it into the ECMs. I would be a lot richer today if I had. The guys at Fujitsu may be thinking along similar lines. Where should we invest more money for the next 3-5 years? |
