All: Disk/Trend, Inc. releases 1996 Removable Data Storage Report
Disk/Trend analyzed six different product groups in the newly
release report on removable data storage. These are:
1. High capacity floppy drives
2. Flash card memory technology
3. Magnetic rigid disk cartridge
4. Optical disk drives
5. Low capacity floppy drives
6. PC Card rigid disk drives
Disk/Trend forecasts the first three groups "to achieve extremely
high sales growth during the next few years." Since the report is
rather long I only included excerpts from the three areas that have
high sales growth potential since this is what IO investors care about.
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"Fast growth markets attract new wave of removable data storage products
High capacity floppy drives are expected to have an outstanding sales outlook as changing personal computer usage patterns make it useful for an increasing share of PC users to own drives capable of recording 100 megabytess or more on each disk. The DISK/TREND forecast predicts that 25.5 million high capacity floppy drives will be sold in 1999. New applications are also expected to boost sales of magnetic rigid disk cartridge drives to more than 9 million units in 1999.
Overall sales revenue for the six removable data storage product groups is projected to increase from $2.7 billion in 1995 to $5.5 billion in 1999. The overall total unit shipments of the six heterogeneous product groups is forecasted to grow from 85.4 million units in 1995 to 151.1 million in 1999.
Here are other highlights from the 1996 DISK/TREND Report on removable data storage:
* High capacity floppy drives are already seeing major shipment increases, with 1995's 827,700 drive total climbing to 5.1 million drives in 1996. The major stimulus on current growth has been the Iomega 3.5 inch "Zip" 100 megabyte drive. The Zip drive capitalized on the right combination of capacity and price to attract many personal computer users now becoming nervous about their risks in failing to back up their new higher capacity hard disks. Many users also need affordable removable data storage devices which are suitable to keep individual projects on individual disks, ready to be loaded when needed. Additional high capacity floppy drive formats now entering the market, some of which also provide backward compatibility for standard 1.44 megabyte diskettes, are expected to make this product area a major battlefield of competing standards, as shipments move up to the projected 25.5 million drives in 1999.
* Traditional markets for magnetic rigid disk cartridge drives have continued to grow, but the major sales expansion opportunity for this product group during the next few years will be in new markets. The availability of competitively priced 3.5 inch rigid disk cartridge drives with capacities of one gigabyte or more opens new opportunities in applications such as video editing, multimedia mastering, and engineering workstations, in addition to high-end consumer applications. 86.7% of the 9 million drives projected for 1999 are expected to be 3.5 inch models, with the balance split between growing 2.5 inch drive shipments and the last of the 5.25 inch drives.
* Despite frequent claims by manufacturers of competitive products that low capacity floppy drives will soon disappear, the standard 3.5 inch floppy drive is expected to survive well into the next century. But the new high capacity floppy drives are expected to divert much of the annual increases in shipments that standard 3.5 inch floppy drives derive from the growing personal computer market. The 106.2 million 1.44 megabyte floppy drives forecasted for shipment in 1999 will represent growth of only 2.6% over the previous year.
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As others and I have said in the past, IO's REAL growth story won't
unfold until at least a couple of years from now. As industry reports
like Disk/Trends points out the conventional 3.5" will still be around
for a few more years. However, forecasted figures for total shipment of the conventional 3.5" will diminish with upcoming year totals
growing less and less than proceeding years. Its too early to announce the true successor to the 3.5" floppy. But as Jim Seymour pointed out in a recent PCMagazine article on removable storage devices, "the ZIP and JAZ are clearly the winners" at the moment. I try to post regular
updates on the LS120, Mitsumi, Syquest, Nomai not to scare IO investors or side with the shorts but to (hopefully) inform IO investors what the competition is working on. As an investor I'm absolutely paranoid about real current or potential future competitors to the tech companies I have stake in - can anyone afford not to be?
Hang in there LONGS!
Hyun |
