<<<<<DR I, DR I , ready for your $0.02 worth.>>>>
Sorry but this will be short.Original question was about the SparQ and possible Iomega damage.
I'm going to go by Edwin's list.
1) Wait on Syquest to go broke.
Not a good way to design a business plan! Who knows if Syquest will or will not go broke.
2) Syqt survives but doesn't thrive (could it damage Jaz and Jaz-2 sales?)
Will be coverred below.
3) Iom exits the high-end market.
I don't really think this deserves a response !
4) Iom matches SparQ's price.
2) and 4) can be answered together. Of coarse SparQ is going to take away some Jaz sales. It was only a matter of time before some new product came along. How many sales will Iomega lose? Who knows ? Listen, you need to consider that the people who run Iomega are not stupid. There are some of the brightest minds in the business working at Iomega and calling the shots. Once again, I can't stress to you enough the impact Clik! is expected to have. If all goes as it appears, Clik! could drive Iomega regardless of Zip,Jaz and Ditto. Now, to combat the SparQ issue.
As you well know,in the electronics industry prices do not hold up for very long. Iomega has been fortunate to maintain the pricing point for this long.But once again, this was well thought out a long time ago. New competition, lower pricing,etc have been expected and factored in for a long time. Nothing new is taking place.
What will happen ? You will soon see Jaz price reductions. But once again, all part of the plan for a long time. In reality,Syquest did Iomega one heck of a favor the other day with the press release about SparQ orders and production. It is now apparent that a rush to lower the Jaz price is not of grave importance. Sure Iomega's margin may be effected a bit but the increase in sales should be very favorable.
More later. |
