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Technology Stocks : INVX Innovex Comdex Winner !!

INVX 22.00

-1.6%

Dec 24 12:59 PM EST

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To: Mark Oliver who wrote (1959)	12/29/1997 6:52:00 PM
From: Greg Hull	Read Replies (1) of 3029

There is an article in the January issue of Twin Cities Business Monthly entitled "The War of the Wires" that contrasts HTCH/TSA with INVX/HIF. It is written by James Mathewson, editor in chief of ComputerUser. The article quotes Clint Morrison of John G. Kinnard and Chris Rolla of J. Michael Patrick. Morrison thinks TSA will win out and Rolla thinks HIF will take the bulk of the market. Here are some comments and quotes from the article: "By most accounts, Innovex has more to lose and Hutchinson more to gain in this contest. If [HTCH] prevails, it will continue to grow faster than the [DD] market ... and [INVX] will watch its highly valued stock take a nosedive amid shrinking volumes. If Innovex prevails it will need to maintain its astronomical margins in a more competitive flex-circuit market in order to warrant consistent stock values." "Wayne Fortun [HTCH CEO] estimates that the HIF solution - bonding two flex circuits back-to-back before bonding the unit to the assembly - will work at speeds up to 400 Mbps. The TSA solution - bonding the preamp chip right onto the assembly will work at around 600 Mbps. While TSA prototypes are flying on drives in Hutchinson testing labs, the double HIF is still in the concept phase, according to Fortun." Fortun - "Seagate has committed three future mobile drive programs to use TSA. Quantum has gone on record as saying all of its new drives will use the TSA concept. Pat Bonnie (Senior VP SEG) - "We are looking at two solutions: TSA and flex-on-suspension (FOS). Both are viable, but FOS is our primary solution." Bonnie - "While Innovex has been very responsive and we have friendly working relations with them, they are not our only supplier and will not be our sole source for flex circuits...[HTCH] is still our main source for assemblies." Bill Murnane (VP INVX) - "There are essentially three manufacturers: Western Digital, Quantum, and Seagate. One's primary path is with flex circuits, another is TSA, and the third is undecided. ...Seagate's primary technical direction is with flex circuits." Morrison - INVX market share will gradually dwindle and HTCH will experience accelerated growth and continue to dominate the suspension-assembly market. Rolla - TSA will be relegated to ultra-high-end systems (such as tiny mobile drives) while the market will favor flex circuits and particularly HIF for the next several years.

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