We know that RDRT is working on 8 qualifications at QNTM, but we do not know what they are working on specifically. One thing we do know is that RDRT makes 60% of tape heads and is working on the SDLT design with QNTM. QNTM is expected to begin shipping SDLT drives this summer. RDRT mentioned 10% of revenues as a target. That probably is incremental, IMHO.
But based on the CNBC interview this morning of Michael Brown, QNTM CEO, two Yahoo posters wrote the following:
messages.yahoo.com@m2.yahoo.com
I saw the segment on CNBC...Brown was much better than last time, when he came off very stiff and wooden. He was more prepared, confident and smooth. He repeated the comment that the storage information business is growing at over 100% per year and he stated that QNTM is focusing its thrust in the new areas of storage, where the main competition is from start ups, and not EMC...he was looking at a niche strategy to avoid direct competition with that company...overall was impressed. His intent was to establish that Quantum is more than as they said on the segment "a WDC type straight disk drive co..." overall he was quite good.. Any other comments?
One other thing Bear Stearns put out a note on QNTM...its valuation...$25 if the HDD business stays
flat..and $39 if HDD and tape drive businesses, as reflected by their tracking stock components, both do
well...
messages.yahoo.com@m2.yahoo.com
The main point had to due with the fact that the DD part of their business is becoming less and less significant. He mentioned that PC sales in the current period are flat, however, in the past this has usually been a down quarter, so flat is actually very positive. He emphasized the growth in their DLT business and the projections for DLT demand growing from 100 mil to over a bil in the next year or 2. Also pointed to their development of smart storage appliances as a growth area. The consumer electronics business also has a lot of potential with products such as quickview. The DD business and the consumer electronics would become part of one company and the DLT and smart appliance would become the second company. Lots of potential for both - left me with a very positive bullish attitude about qntm.
Portions of a new release yesterday indicate that the growth in this sector is going to be great:
dailynews.yahoo.com
EMC Offers New Networked Storage, Sees Vast Market
Michael Ruettgers, EMC's president and chief executive, estimated the new products could help expand the potential markets the company targets to as much as $50 billion in 2002, up from the $35 billion market it expects to address by 2001.
''I'm convinced we're at the beginning of a multiyear explosion of enterprise storage,'' Ruettgers said in announcing EMC storage systems that can give employees a company-wide view of all the information stored on company networks.
The information storage market is seeing explosive growth fueled by Internet use and the advent of low-cost, high-speed systems that link centralized data centers to a company's far-flung operations.
Going back to what Michael Brown said this morning, QNTM is working on "storage appliances" that will just plug into a network, rather than demanding installation into the server or establishing a server. That gives rise to more demand for hard drives and allows users to store much more information easily within networked environments. He specifically said that the growth in that segment would be from $100 million to $3 billion in a few years.
That is very strong growth, IMHO!!!
Now if RDRT's qualifications have anything to do with that product segment, which in my opinion is a very logical guess, RDRT could be a beneficiary of this growth. His comments on hard drive units being flat rather than down are also bullish. He went on to say that he expected full year units (hard drives) to be up, with strong sales expected in the Christmas season.
On a separate announcement yesterday, WDC's 18 gig enterprise program was mentioned by Cyril at the shareholders' meeting. So I am assuming that yesterday's announcement is a win for RDRT. I have e-mail into Investor Relations to confirm my guess.
biz.yahoo.com
Later, (-8 Dennis 8-)
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