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

To: Stitch who wrote (8105)	3/16/2000 11:37:00 PM
From: Z Analyzer	Respond to of 9256

<<I do not think there are any diminishing returns from the accelerated density curve in terms of market growth and the introduction of new applications. At least there are none until we hit the so-called paramagnetic limit that is theorized today to be around 100Gb/psi. >> I agree with your comments about market growth. My comment refered to a slowdown in density increases as we near the paramagnetic limit. Perhaps the ease we approach it is because only bit density is approaching a theoretical limit but the other enabling technologies are not approaching their limits. I've seen too many disk drive rallys and selloffs to be confident the world is really different now, especially with summer around the corner. And, I also agree that in a normal market, 10 or 12 percent gross margins will not send these stocks or profits to the moon. In this market???? -Z

To: Stitch who wrote (8105)	3/17/2000 2:41:00 AM
From: Tom Simpson	Read Replies (2) \| Respond to of 9256

Some semi-representative data I dug up from Quantum spec archives. Max Date Model Density Seek Capacity Disks Heads GB/Surface Cost/GB apr-95 Atlas II 0.66 8.0 4.5 5 10 0.45 330 jun-97 Atlas III 1.40 7.8 9.1 5 10 0.91 110 may-99 Atlas IV 3.40 6.9 9.1 2 4 2.28 49 nov-99 Atlas V 6.80 6.3 9.1 1 2 4.55 25 The date is the model announcement date. The max density is the areal density in the track closest to the spindle, a thoughtful touch on Quantum?s part to note that. The cost per GB is based on the list price in the announcement. In less than 2.5 years (jun-97 to nov-99) the no of disks required to make a 9.1 GB drive went from 5 to 1. By the end of this year, a single surface of a single disk will suffice for that capacity. On the bright side, now that we are finally down to 1 disk for most PC?s, PC unit growth can once more begin to flow through and become unit growth to the food chain. Video and other new markets might even become noticeable growth additions. Its really quite remarkable that so far only APM has failed to survive. Best Regards..Tom

To: Stitch who wrote (8105)	3/17/2000 11:36:00 PM
From: Kevin Linder	Respond to of 9256

I would never, ever begin to question Stitch's knowledge of this field and the technicals involved. This quote though I think bears a lot of dwelling on by all investors in this field: "Still, I do not think we are going to see a repeat of gross margins similar to what the industry had before this downturn began two and half years ago. The real question is who is going to thrive on 10-12% gross margins." There are two models of DD company operations: 1) The vertically integrated manufacturing or 2) "Virtual Manufacturing" (what Finis Conner is trying to do). If Stitch is right about gross margins staying where they are then it will be interesting to see which is the more efficient. Granted, at different times each has there merit -- but for the next 6-12 months or 2 years which will prove the best? Just pondering on a Friday night.... Kevin Linder

To: Stitch who wrote (8105)	3/18/2000 3:11:00 PM
From: Mark Madden	Respond to of 9256

Stitch - Thank you for the information on the cost of glass platters. I haven't seen competitive desktop prices by IBM in the retail market but I think they are a lot more aggressive in the OEM market. Their first to market glass platters may give them big cost advantages in the high end desktop. The 10 to 12% margins predicted sound good right now. We should be there in a quarter or two if the prices remain stable. For the margins to stay at 10 to 12% while the manufacturing costs decline faster, the pricing erosion will have to restart. It will be interesting to see if we can predict the margin decreases by monitoring the prices. Regards, Mark