They are behind the density curve, Quantum and WD are way ahead and pulling away. If you don't believe me, study the specs. You'll find Quantum and WD achieving the same capacity points as Seagate, but with fewer disks and heads.
The thing to remember, however, is that SEG is going to end the year manufacturing 80% of its head and platter requirements. That translates to $20-40 (even more per IDEMA) in savings per disk drive in cost of materials. So, until they introduce their 4.0 GBits/in2 spin valve head in December and catch up in the density race, they can still be competitive even if they use more heads and platters. Additionally, even if all SEG can do is catch up with the density leaders, one can easily see how that increase in density will boost the performance of its high-end drives, widening the gap between SEG and its competitors including IBM.
The only one with a clear shot of pulling away is the current density leader, IBM. It spent $1.3 billion in 1996 and it recently added another $1 billion so the disk drive unit can add more capacity. |
