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Non-Tech : Any info about Iomega (IOM)?
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To: Rocky Reid who wrote (57289)7/17/1998 10:16:00 PM
From: Cogito  Read Replies (1) of 58324
 
>>All along I thought it was Iomega's contention that the tie ratios are defined as the total amount of discs sold for all Zip drives existing in the world, regardless of any time constraint.

Now, it seems the definition has been modified to mean the number of Zip discs sold compared to the number of drives sold in a given Quarter, completely ignoring the installed base. This doesn't tell you anything about how well Zip disc units are moving compared to the installed base.<<

Rocky -

No, the definition hasn't changed. I think the reason you're getting the wrong answer from your equation is that you are setting up the problem wrong.

Try putting it on a graph. Draw a line representing drive sales increasing at 35% per year. Now draw another line representing disk sales, but peg it at a steeper angle for 44%.

I know that doesn't reflect reality, because no growth line is ever completely linear. There are always times of lesser or greater growth. But it will illustrate the point I'm trying to make.

As our new and quite eloquent friend M.F. pointed out, if each new user buys an average of five disks in the first year, then an average of only one or two disks in successive years, the overall tie ratio will go up over time. If each new user buys no more disks after the first year, then the tie average will stay the same.

But if the tie average were staying the same, then disk unit sales would not increase faster than drive unit sales.

- Allen
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