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Technology Stocks : Western Digital (WDC) -- Ignore unavailable to you. Want to Upgrade?

To: Sarmad Y. Hermiz who wrote (10758)	9/3/2003 9:21:42 AM
From: Sam	Read Replies (1) \| Respond to of 11057

Sarmad, I don't know if you wade through the yahoo XMO board or not, but here is an interesting post on MXO vs. WDC by a long time follower of DDs (arbpro). Am interested in your reflections on it. Maxtor v. WDC by: arbpro 09/02/03 06:59 pm Msg: 95549 of 95572 Here are my reasons I favor Maxtor. 1. RDRT is a BIG gamble. My contacts tell me that MM's glorious dream of instant earnings on RDRT is fantasy. Assuming, for sake of argument, that WDC pulls off the big gamble without any damage to its earnings, it still has accomplished nothing. RDRT production costs, again assuming everything goes perfectly, will be in line with TDK and ALPS. WDC must execute flawlessly and assuming it does, there will be little payoff for a big risk. Further, WDC's R&D expenses must go up as a result of RDRT. By the time the 80 is up and running it will be time to throw more money to higher density research. 2. SCSI. MXO is cutting into Seagate's market share and will continue to do so. I think Tufano will raise his market share goal from 20% to 30% by the end of the year. This is an area of higher margin as opposed to WDC's DT and X-box. 3. One Touch. These are great sellers in the retail market. MXO is fast becoming the retail customer's choice because of the simplicity of the one touch design. 4. CE domination. There is no doubt that MXO, and not STX, is the number 1 seller to the CE manufacturers. MXO's close relationship with the CE pioneers (TiVo, Replay, DISH, EchoStar, Sony, etc) insures a bright future for Maxtor. The CE space is where the dd will see great demand in the next 3 years. One day, withiin the next 5 years, CE demand will exceed PC demand. The day when all TV's and Cars will be equipped with DD's will come. MXO has a commanding lead in this important area of future growth. 5. Tufano. Yeah, that is right take Tufano over MM. MM accomplishments came as a result of the MXO/HDD merger and MXO's inability to execute during the 18 months following the merger. WDC benefited. The advantage is over and Tufano, on an even playing surface, will outcoach MM. 6. China. There is a reason that big tech cos. like Intel are locating manufacturing in China. In 04, Maxtor will be producing there. The benefits will be on both ends, ie. reduced costs and a presence in the next great PC market. 7. There is a reason that Seagate spends so much time badmouthing Maxtor. Seagate fears Maxtor. 8. Maxtor went through a rough 18 months following the merger and learned a lot. It learned not to even bid on RDRT. It learned to slash OE to 115mm per quarter while continuing to develop leading products with R&D money. It learned to be modest, and let the numbers at the end of the quarter do the talking. It learned that making profits leads to the ability to sell your conv. at a 125% premium and have it oversubscribed. It learned that becoming a legitimate threat to STX would cause STX to unleash its bankers to badmouth and downgrade. It learned that the best way to silence the STX minion is to execute. I like MXO v. WDC.