Mark,
"I wonder if there will be a consolidation of Samsung and Maxtor? Seems logical that the different chabols could do themselves a service by trading under developed business units to play on strengths."
I doubt if they will merge. From everything I can gather from reading, they are in different leagues for now--Maxtor is far ahead of Samsung in quality and strategy (although I am personally suspicious of Maxtor; I will believe that they are for real after they've made a successful product transition or two). If the article I pointed to a couple of posts ago (see post 2501) is correct in saying Hyundai and the other major chabols were told by Korea Inc. President Kim to sell their non-core businesses and focus on their core competencies, then I am guessing that they will both be out of this business within the next year, and perhaps much sooner.
This is especially true if pricing pressures remain strong; it just doesn't make sense for them to stay in this business given their secondary position in it. (That is why I am not that unhappy about pricing pressures right now--if it had to happen at all--and why I think it makes some perverse sense, taking a long range view of the industry from the point of view of SEG, QNTM and WDC. They do not want to compete against a "country-run company", as it were.) That is more true of Samsung than of Maxtor, but given the relatively small size of Maxtor's business relative to Hyundai at large, I can't imagine that they define it as a "core" business. They will sell it or spin it off. Perhaps (WARNING: raving speculation follows) one reason that WDC is raising, what is it, $500 million is to buy them. Who knows, but the sale of Symbios to ADPT was a good sign, IMO.
Anyone else have an opinion about this?
Best regards,
Sam |
