I personally think rumors of a contract are virtually meaningless at this point. It is clear that the most of the top 7 disk manufacturers are talking to Ampex. After all, how would you like to be one of the few disk drive makers offering 1.0 GB disk drives while your competitors are offering 1.4 GB disk drives at the same or slightly higher price point?
But hey, it's a weekend so why don't we play with this Maxtor rumor, shall we? Maxtor is now owned by Hyundai, a huge Korean chaebol, or conglomerate. If you have been following the Stormedia and Maxtor relationship you will discover, in one of the SEC filings available on public EDGAR, that Maxtor's supply agreement with Stormedia contained an unusual and remarkably detailed side-agreement noting Hyundai's plans to build a media manufacturing operation and how Hyundai agreed to limit its output (for 2 or 4 years, I don't remember) for internal use only, essentially a non-compete clause designed to protect the supply agreement. Maxtor and Hyundai have since repudiated the entire supply agreement and Stormedia has sued Maxtor/Hyundai for breach of contract.
Let me digress for a moment and point out to the recent pre-announcement by HMT Technology that it wasn't going to meet estimates for this quarter due to lower-than-anticipated orders from one customer. As of the May prospectus of HMTT, Maxtor accounted for 40.5% of HMTT gross sales. Maxtor is, at the very least, a suspect.
The only reason that Maxtor would jeopardize its supply of platters - Stormedia certainly, HMTT probably - is that it is reasonably assured of getting a steady supply from the mother ship, Hyundai. Now, what better way to get a media manufacturing startup off to a good start than to include a very feasible and patented feature in the platter output? I am also certain that the Hyundai octopus has its tentacles in consumer electronics (read VHS/8mm products = licensing agreement with Ampex) so there is already an existing relationship. It is so much easier to expand an existing trouble-free relationship than it is to start a new one.
Western Digital is, I think, an even better match. But, that's yet
another rumor for another day. |
