Disk Drive Sector Discussion Forum Message Board

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Technology Stocks : Disk Drive Sector Discussion Forum

WDC 215.00

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Jan 14 3:59 PM EST

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To: Tom Simpson who wrote (8569)	8/19/2000 5:00:31 PM
From: Gus	Read Replies (1) of 9256

Its a classic case of rich gross margin chasing which kills the goose that yada yada yada. The trouble with NAS is there just isn't that much to it...no real complex software barrier. Maxtor was one of the first drive makers to fit two drives in the most popular rackmount chassis. Its NAS revenues are currently neglible, but a few months ago, it was expected to grab 20% of the 2001 NAS market with 30-40% gross margins. Now, expectations have been ratcheted down by one buyside analyst who now expects Maxtor to eventually capture ONLY 12% of the 2001 NAS market *with 20% gross margins* this time. <G> there is a little good news for heads, suspensions, and platters in this trend towards smaller platters, i.e. 3.5 inch towards 3 inch towards 2 inch as rpm goes up. I hate to rob you of that little glimmer of hope, Tom, but the 2" and 3" are used in the premium-priced 10k and 15k drives that will probably never reach the least profitable (but highest volume) parts of the desktop in less than 5 years. Now that you mention it, the ex-IBMmmer here was Gottfried.

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