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Technology Stocks : Disk Drive Sector Discussion Forum -- Ignore unavailable to you. Want to Upgrade?

To: T Bowl who wrote (6538)	6/8/1999 12:47:00 PM
From: Mark Madden	Respond to of 9256

Todd, Lawrence, I do not think my model is as sophisticated as either of yours but I did notice some unusual events. I have seen a high changeover in drives being sold by distributors. Many drives being sold at the beginning of the quarter are just not available any more. New drives have come on the seen with lower prices and more capacity. Twelve Quantum drives I had been tracking just vanished from distributor offerings. They began offering four new drives I had not seen before. A few of the new drives seem to be changing the entire landscape. The Seagate U4, 8gb and the Quantum CX 20gb are newer offerings that must dominate the desktop market. These drives undercut the company's own lower capacity drives in price and must also take heavily from their own higher capacity drives. They provide moderate performance for extremely low prices. I do not think the lower prices of the new drives is the same as the oversupply price cutting we have seen in the past. These new drives are designed to sell for a lower price and therefore have acceptable margins at their selling price. However, they may be forcing lower prices for older drives. Otherwise, older drives will gather dust in inventories unless they have performance advantages. The trend seems to be fewer drive offerings but low prices. This trend may favor automated manufacturing because of the huge quantities of the fewer drives available. Mark M.

To: T Bowl who wrote (6538)	6/9/1999 1:42:00 AM
From: Frodo Baxter	Respond to of 9256

>I don't see it getting anything but worse. As you know, I'm a big fan of pricing following supply and demand. More darwinian survival instinct than this OPEC oligopoly price fixing nonsense. So, I guess I'm not all that surprised to report that Quantum's attempt at raising prices, which I reported on yesterday (for god's sake!) has already collapsed. Not only that, WDC still hasn't followed the price cutting. They're gonna have some major issues moving their already-bloated disti inventory (can anybody say channel stuffing? I knew you could). Maybe, thankfully, finally, the endgame is near. Keep your shorts on, buddy!