Disk Drive Sector Discussion Forum Message Board

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Technology Stocks : Disk Drive Sector Discussion Forum

WDC 179.68

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Dec 29 3:59 PM EST

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To: Mark Madden who wrote (8899)	11/18/2000 11:07:55 PM
From: Mark Madden	Read Replies (2) of 9256

Here is a weekend report on disk drive pricing from a sample of retail distributor drives. The samples include 355 drives from 5 different distributors. The average sample of desktop disk drives dropped slightly last week. Average price change this week (weekly rate): Weighted desktop --- down 0.6% Less than 11gb --- up 0.6% 11gb to 21gb --- up 0.1% Greater than 21gb --- down 1.3% Enterprise --- down 0.1% Current Quarter price change (monthly rate): Weighted desktop --- down 1.3% Less than 11gb --- up 1.2% 11gb to 21gb --- up 0.2% Greater than 21gb --- down 3.5% Enterprise --- down 0.8% 3rd Quarter price change (monthly rate): Weighted desktop --- down 1.9% Less than 11gb --- down 1.3% 11gb to 21gb --- down 1.7% Greater than 21gb --- down 2.3% Enterprise --- down 2.9% 2nd Calendar Quarter price change (monthly rate): Weighted desktop --- down 3.0% Less than 11gb --- down 3.7% 11gb to 21gb --- down 2.8% Greater than 21gb --- down 2.6% Enterprise --- down 1.7% 1st Calendar Quarter price change (monthly rate): Weighted desktop --- down 1.5% Less than 11gb --- down 1.1% 11gb to 21gb --- down 1.3% Greater than 21gb --- down 2.2% Enterprise --- up 0.1% Sample prices are doing well this quarter but not rising as might be expected with reported shortages and price increases. The 1.3 % monthly decrease half way through the quarter beats the 1.9% decrease of a year ago at the quarter’s half way point. Last year’s 4th calendar quarter prices ended with a 1.3% decrease as earnings beat expectations. Stable prices coupled with cost reductions are a good combination for profits. Costs may be falling as drive makers change offerings to 20gb per platter. Hopefully higher component costs will not have much impact on profits. Also the mix of drives is changing to higher capacity as data is changing to digital and bandwidth is increasing data. The newer markets of server storage and consumer products are small but growing fast with appetites for higher capacity. Higher capacity translates to higher margins. Regards, Mark

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