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To: Barney Dunn who wrote (8799)	4/7/1999 12:09:00 AM
From: David Colvin	Read Replies (1) of 10072

Barney, well david you are missing 1 important thing in your model Although you mention new products -you don't take into account the next generation jaz drive that is going to be released end of second quarter of 1999. This is going to really boost revenues in second half of year and probably kill any competition left Actually, I did make a passing reference to such a new product in Para 1. of my comments for the year 2000. Here is the reference: "I also assume there will be other new products introduced in 1999 with meaningful sales starting to materialize during 2000." It was my intention to "cover" such a product with this statement. The problem is I have no firm knowledge that such a product will be introduced in the near future and also don't believe Iomega will, in fact, introduce such a product unless they absolutely have to because of the cannibalization effect I believe it would immediately have on Jaz sales. Had Iomega known that Sony would sell only about 100 of their 200 Mb HiFD drives before halting sales of them (they claim they haven't recalled them by the way) I believe it's very likely Iomega would not have released their 250 Mb Zip drive when they did to "trump" the 200 Mb HiFD drive. I believe the Jaz drive is only a "niche" product compared to Iomega's mainstream moneymaker.....the Zip drive. As far as I'm concerned, only power users and certain professionals feel they even have a need for such a large capacity drive. The evidence of this is the fact that Iomega has only sold a little over 2 million Jaz drives since it's introduction in December of 1995. Personally, I have a Jaz drive and use it quite frequently while only one of my friends has a Jaz drive (along with 5 Zip drives). On the other hand, all of my other friends with computers own a Zip drive. Syquest literally went bankrupt because there just wasn't enough demand for their Sparq drive and they apparently "bet the farm" on it. I do appreciate your observation, but as far as I'm concerned this "new product" is definitely an unknown quantity at this time. Dave

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