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Non-Tech : The New Iomega '2000' Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Ken Pomaranski who wrote (3218)	10/19/1999 11:25:00 PM
From: D.J.Smyth	Respond to of 5023

Ken: If you have $1 and you're making 40% profit on 20% of that dollar ($.08 earnings on $.20 in revenue) and 12% loss on the other 80% ($.10 loss on $.80 in revenue), the objective would be to attempt to shift more and more weight toward the profit edge and away from the loss edge. IOM will not, won't, can't continue to sell zips for lower than their loss limit allows - it simply can't be done regardless of the squeeze. Dell has squeezed every cent they can out of IOM, and IOM is not considered a major component supplier anyway since many of the drives are optionally featured. The number of drives went from 19 million to 29 million - you're absolutely correct. However, the revenue derived from the last addtl. 10 millioin zip drives sold was 1/2 the revenue derived from the second 10 million drives sold - and the loss from the last ten million sold was also 65% greater than the second 10 million sold. Thus, the zip disks are becoming a greater and greater percentage total of IOM's revenue. This comment "That in order to keep the number of disk sales constant, you must double the installed base year over year!!! This is VERY, VERY, bad if this trend continues" is only valid if you KNEW THE TOTAL NUMBER OF ZIP DISKS SOLD IN THE THIRD QTR OF 98. But you don't know Ken; (a) You don't know if the third qtr 98 was an aberation higher or if this qtr. is an aberation lower. We do know that zip disks have been increasing year of year, qtr over qtr, with minor fluctuations between qtrs. and (b) the 250mg disk accounts for more disk space than the 100mg disk - IT'S IRRELEVANT AS TO THE NUMBER OF DISKS, AS LONG AS THE DISK REVENUE CONTINUES TO CLIMB; what else matters? They could come out with 400mg disks tomorrow, so now they need to sell four 100mg disks for each one 400mg. So next year, they say, we sold 200% less disks, yet our disk revenue is 20% higher, why do you care how many disks are sold as long as their disk revenue is higher? IOM sold 16 million zip disks in the 4th qtr of last year for about $65 million in revenue. If IOM sells 15 million zip disks this 4th qtr, yet generates $75 million in revenue - fine, that only tells me that the number of 250mg disks is becoming an ever greater percent of the total disk output! You see, Ken, I can use exclamation marks too!! Why Dundee decided in his great wisdom to put the phrase regarding disk sales without identifying disk revenue (although if you have a model you can figure it out) is beyond me. He apparently wants to suck every short into this stock from here to kingdom come before he pounces on their gloating ass like a sick man when he produces numbers which throws them into a tizzy living cesspool of gloat slime. Let's not forget that Dundee is the largest stockholder of IOM, bar none. He stands to lose the most if he fails this one.

To: Ken Pomaranski who wrote (3218)	10/19/1999 11:39:00 PM
From: Blackmarlin	Read Replies (1) \| Respond to of 5023

<<In my mind, this was the WORST report ever for Iomega, but not many realize it. It shows that there is very little support for future growth.>> Ken... couldn't agree more. The older DUNN gets... the deeper IOM sinks... Two weeks ago I saw Peyton Jordan break the world record in 84 yr old category for the 100 yard, by 4/10th's sec. It was disallowed because there was a 4 knot wind behind him. He offered to run it again, against the wind... and was confident to repeat the feat. Big difference in someone who knows his ability and doesn't sacrifice the well being of others... and one who is neither aware of his ability or cognizant of his risk to others... We need a new CEO...