Fernando,
Let me preface my comments by saying that I appreciate your analyses of
the Zip revenues. I am in no way trying to be mean by questioning your
numbers. I am only trying to spark debate as to the true (as yet unknown)
revenues per drive. That having been said:
It seems that you have gone even further away from what I would consider
to be a reasonable drive revenue. $160 is just not very likely. I bought
my Zip drive recently for $179, shipping at the cost of the vendor. A $19
mark-up for the vendor seems pretty slim. Furthermore, we just bought
one for my job. (BTW, this makes 7 drives for either my work or my
co-workers and 60+ disks... tie ratio not quite 10). Anyway, the recent
drive for work was assembled in the Philippines (Seiko-Epson ??) and cost
$189. $160 for Iomega, $29 to be split between Seiko Epson and the
vendor?? Then, consider the price of the internal... $99 from Micron
(estimates are that 25% of Microns sell with the Zip option). Micron,
HP, Power Computing, etc... are not buying the thing for $160 and
selling it for $99! A break down of internal/external sales or manufacturing
from Iomega could clear these points up.
In short, the ONLY way I see anything above $100 per drive on average is
if... DELL is selling A LOT to the U.S. Government on the GSA(??) for
well over fair market value. Come to think of it, that scenario is not
unlikely!!! Also, another possibility is that sales of Zip related items:
carrying case, power converters, cables, Zip Zoom SCSI card, etc... are
significant. Can anyone comment on this???
You must now believe in the 8 million drive capacity by year-end.
Your 12/96 sales of 0.66 million drives translates into 7.9 million
annually. Or do you believe that 1/97 sales will drop to 0.4 million,
in line with the 5 million capacity? Also, the 5 million capacity number
was based on Iomega and partner's capacity. How is the split between the
two likely to affect the numbers?
My personal views (highly uneducated) are that ~$100 per drive and ~$11 per
disk are better estimates. I also feel that KE seriously understated
the impact of Jaz in the Q1 figures. This was to keep the competitors from
getting too excited about entering the market. It may be Q3 before we
see the actual breakdown of Zip and Jaz.
Jay
LONG on IOMG |
