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Technology Stocks : Disk Drive Sector Discussion Forum

WDC 230.08

+3.2%

9:37 AM EST

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To: Sam who wrote (8715)	9/19/2000 3:09:26 PM
From: La Traguhs	Read Replies (1) of 9256

Interesting question you raise about WDC. In my opinion, WDC would stand to gain from the HDD/Maxtor deal. Why? HDD+Maxtor will not equal 2. Last quarter Seagate shipped about 10.4 million units. Quantum did about 8.2 and Maxtor about 6.5 - which when combined is 14.7 million - but remembering what happened when Seagate bought Conner, 1+1 did not equal 2. That means others will benefit and that includes WD. Besides, the box builders will not like seeing the industry consolidate. Again, look back when Seagate bought Conner. They will favor going to WD while consolidation issues sort themselves out. They hate to have their negotiating leverage reduced and would shore up the others left. But since WD would be the only other HDD company left to invest in (i.e. Seagate going private and the others are foreign non-pure play HDD companies), I'm thinking at 5 plus a share, WD looks good. Especially in view of my latter comments. Now for more rumors going around. Samsung is getting close to pulling the plug. High level "strategy" meetings have been on going. They are still below the magical 1 million drives per month. I'm told they are on a quarter by quarter thread which could be broken at any time. Other rumors have IBM giving serious consideration (at the Armonk, NY level) to getting out of the disk drive business. Hitachi is mentioned as a potential suiter. Now, a wise industry sage said to me a few months ago that with a few years there will be only 4 HDD manufacturers left: Seagate, Fujitsu, Maxtor/HDD, and - get this - Sony. Now I believe that's the start of another rumor. Definitely food for thought. Perhaps Stitch and others might weigh in on these "heady" comments. So for investment opportunities...I'm in the process of trying to sort all this out and forming a direction. Regards, LT

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