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Technology Stocks : Seagate Technology
STX 396.23-6.8%4:00 PM EST
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To: still learning who wrote (3017)9/15/1997 9:52:00 PM
From: roger held   of 7841
 
still,

So how do you define volume? Seems to me like selling 200,000 18GB drives is like selling 2,000,000 1-2GB drives. The profit margins will be a lot higher. The 18GB drive sales are very low profile (not visible to the average person) because they go to big OEM's not to distrib. houses or into PC's. But the "big" payoff is in the high capacity, high margin drives. Every 1% in high end market share is worth 2% of desktop market share. SEG would rather sell 18GB drives because there is less competition. Anybody can make 1-2GB drives and it takes a very special company (like WDC) to make a profit at it.

Besides, who says SEG will not be selling 1-2GB drives? They may have eliminated some older models, but they will be coming out with updated, more cost effective models. Any company will get involved in a market where there is some opportunity.
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