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

To: LK2 who wrote (8567)	8/19/2000 1:26:24 PM
From: Mark Madden	Read Replies (1) \| Respond to of 9256

Here is a weekend report on disk drive pricing from a sample of retail distributor drives. The drives include 375 samples from 6 different distributors. The average sample of desktop disk drive prices dropped last week. Weekly average price change (weekly rate): Weighted desktop --- down 1.1% Less than 11gb --- down 0.5% 11gb to 21gb --- down 0.8% Greater than 21gb --- down 1.6% Enterprise --- down 5.4% Current Monthly price change (monthly rate): Weighted desktop --- down 2.6% Less than 11gb --- down 1.1% 11gb to 21gb --- down 2.4% Greater than 21gb --- down 3.1% Enterprise --- down 5.7% Current Quarter price change (monthly rate): Weighted desktop --- down 2.4% Less than 11gb --- down 1.5% 11gb to 21gb --- down 2.5% Greater than 21gb --- down 2.5% Enterprise --- down 3.9% 2nd Calendar Quarter price change (monthly rate): Weighted desktop --- down 3.0% Less than 11gb --- down 3.7% 11gb to 21gb --- down 2.8% Greater than 21gb --- down 2.6% Enterprise --- down 1.7% 1st Calendar Quarter price change (monthly rate): Weighted desktop --- down 1.5% Less than 11gb --- down 1.1% 11gb to 21gb --- down 1.3% Greater than 21gb --- down 2.2% Enterprise --- up 0.1% A well written and detailed report by Hoefer & Arnett contradicting the Salomon Smith Barney (SSB) report a few weeks ago sparked a rise in drive stock prices this week. However, the sample of drive prices dropped. Higher capacity drives led the price reductions as retailers possibly began clearing inventories to make room for the coming 20gb per platter drives due soon. One of the retailers discontinued half the drives they were carrying while dropping prices on their remaining drives for the first time this quarter. Price reductions in the higher margined high capacity drives lowers profit margins. However, this is the sector that will have the largest manufacturing cost reductions with the coming 20gb per platters. Also this is an area that can increase market share though markets other than desktop PC’s. The price reductions in set top boxes, personal video recorders or NAS applications will likely result in greater sales quantities. These are also areas that can use greater capacity as a desirable selling point. The enterprise sector was largely impacted by price reductions in the IBM 9gb, 18gb &36gb drives by one retail distributor. The retailer dropped the price of 10 of these drives an average of $163 each. Regards, Mark