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

To: Mark Madden who wrote (7811)	1/16/2000 9:45:00 PM
From: Z Analyzer	Respond to of 9256

<<Drives can be sold at higher prices. The key to the industry is for manufacturers not to produce more drives than they can sell at profitable prices. >> The issue we rarely discuss here is that this is not a perfect commodity market from the economist's definition in which you have numerous buyers and sellers, none able to influence the price. The situation is perhaps worse. The problem is that the balance of power is shifted to several of the buyers who have great bargaining power by virtue of their ability to cut business with a particular seller who is too aggressive. Lose not only the incremental business but other business as well. This does not happen with a true commodity such as a farmer selling grain. Who is going to try to push a price increase over on Dell at the risk of losing a big chunk of business that is not readily sold to someone else except at fire sale prices? -Z