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

To: T Bowl who wrote (7949)	2/13/2000 8:56:00 PM
From: Sam	Read Replies (1) \| Respond to of 9256

Todd, Could you give a URL for the Insight article that you quoted? Thanks, Sam

To: T Bowl who wrote (7949)	2/14/2000 1:09:00 AM
From: Tom Simpson	Read Replies (1) \| Respond to of 9256

<<Any weak player is toast. KMAG is next, followed by RDRT. (and WDC will be somewhere in there as well IMO.)>> Todd, My general uncomfortable conclusion as well, but I'm not so sure about the order .....and thanks much for that wdc density forecast data although I couldn't find it myself on the wdc site. Did you get it out of the 99 annual report or what? In any case, it tracks awfully close to the graph I've constructed from various other mixed sources and confirmation comforts a lot. I quibble with the article just a little bit. It isn't drive demand that is unstable, but rather GB supply and that because of the dramatic changes in the density growth curve. I also think that as we get close to 1 platter drives in desktop things will get dramatically better for the survivors, whoever they might be. You don't get nearly as much cost leverage cutting out one side of a single platter (i.e. single surface) as you do cutting out 1 of 2 whole platters so end unit growth demand will actually start flowing through to components again. A year after that investors will be screaming at dumb managements for failing to invest in capacity :o) Re WDC..... I can't quite figure out how joined at the hip they are with KMAG. If KMAG goes belly up WDC is probably out the 30 million note they took in the sale and they lost their main disc supplier. Depending on the actual terms of the supply contract they made in the sale that could be a good thing or a bad thing. I notice that KMAG's asp is around a buck higher than HMTT's and the easy way to explain that is to assume KMAG sealed in premium pricing as a condition of taking over WDC's platter operations; pure speculation on my part of course. But even with the lower asp HMTT is beating KMAG on gross margins so something ain't quite right somewhere. On the other hand, should WDC go belly up its hard to imagine how KMAG survives the following quarter. Looks to me like components flounder at least through most of CY2000, maybe even longer....and should we run into minor problems keeping up with the WDC density schedule, it will just prolong the basic agony. Can Seagate sail thru quite so relatively unscathed? I doubt it; they make a lot of components, but then a Veritas can cover a lot of sins :o) Thanks Todd.....Tom