RE: **Back on Topic** Mea culpa, and the HiFD issue
Gary and all,
Okay, I'll own up to being a big cause of all the fluff.
Sorry. I only have two weak excuses to offer in defense,
one being that I'm scrupulous about putting "OT" in my
header if the message is off topic, and the other being
that the thread has been boring lately. What's there
to say about Iomega other than that it's growing steadily
and the Zip is showing every sign of becoming the standard?
Well, there's a little to say. Off-thread, Jack Knutson
asked me about protecting his long investment with some
puts following Darrell's cryptic message about a dive to
17. Here was my response to him, which he encouraged me
to post here for others to ponder:
It's your money, of course, but I'm staying put at the moment. The Nomai
thing just doesn't worry me at all. There's no way those folks are going
to put any serious dent into Iomega. As I said on the thread, though, I
AM a little concerned about this Sony thing, and the TEAC announcement
today adds to that concern. Why, I ask myself, would Sony do this HiFD
thing at the same time that they're selling Zip disks under license and
also including Zips in their boxes? They must know that it's going to
take a real winner of a device to unseat the Zip. There are only a few
options. One is that they're quite certain that they've got just such
a winner of a device. Two is that they think the thing will be useful
for cameras (i.e. as the replacement for the 1.44MB floppy in the Mavica
camera) and other things but will not unseat the Zip in PCs. Three is
that this is all bluster of some sort that I can't fathom. And four is
that Sony is one whole hell of a lot stupider than I think they are.
Of those four, I'm afraid number one is the most plausible, and they're
being strangely low-key about the whole thing, which is a weird way to
introduce this. I fear that they're certain enough about its promise
that they're ramping it up a bit before springing it on the market, to
be sure there are plenty out there and the price is right. If I'm right
about that, and of course that's a big if, then this could challenge the
Zip and affect the price.
On the other hand, eleven million Zips, and another million every month
while we wait for the HiFD, plus lotsa OEM arrangements under Iomega's
belt, constitute a formidable wall for Sony to scale. In addition, I
suspect that Iomega can retaliate with a cheaper Zip or a higher-capacity
Zip or a combination of both. So in the long run, I'm still willing to
bet my money on Iomega in this competition.
In any event, though, I don't see any Sony-induced dip in Iomega's growth
curve setting in overnight. This is going to take a few months. It's clear
that the institutions aren't dumping the stock in a panic. Nor will they.
Consequently, you've got at least a few weeks to make up your mind. Why
bother with selling those 40s at a loss and spending the insurance money
on puts if you don't have to? Instead, why don't you just think through
what strategy of this sort you'll use and then have it all ready to execute
without further thought the moment you see some more substantive evidence
of a problem than what Darrell has given us? He's not infallible, of course.
Please keep up the volume updates, Gary. They're very
valuable and informative. If I have anything even remotely
valuable of that sort to post, I'll post it, and if not,
in deference to thread minimalists like you, I'll shut up
for a while.
Happy Thanksgiving, all.
Cheers, Tom (long IOM) |
