Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Mark Oliver who wrote (1664)	12/2/1997 5:46:00 PM
From: Sam	Read Replies (3) \| Respond to of 9256

Mark, I don't really know. A lot--no, a huge amount, not just a "lot"--depends on what kind of ambitions companies like Fujitsu and Samsung have, and if they are allocated the resources to act on those ambitions. Do they want to make an assault on the drive business like they assaulted the DRAM memory business? If they do, then investors in these businesses (that is, legitimate private companies) are toast, because they won't be competing against a company which has limited resources, they will be competing against a country where failure--that is, losing money--doesn't have the consequence that the business goes under. Now perhaps Japan is finally learning that they have to change, that prices can't keep going up for real estate, and they can't keep selling things for tiny profit margins. Perhaps. I'm not sure. I doubt very much if Korea believes this--in the article I quoted from a couple of days ago (or was it just yesterday?), some Korea said something like they don't need lectures or conditions from the IMF, they just need cash. Nothing is wrong, as far as they are concerned. But actually, there is plenty wrong, and if the IMF allows it to continue, they will just end up in the same condition a few years from now (or perhaps even sooner). Capitalism is surely like magic if you live under these conditions. Just build and build and build. You don't have forecast very accurately. You don't even have to innovate--the innovators (sometimes American technology companies, sometimes Japanese steel companies, etc.) just sell you the technology to do everything, and you put it together, use low cost labor and, in effect, unlimited capital to produce, and off you go. The basic condition that capitalism recognizes that socialism often (but not always) forgets is scarcity of resources. Prices, interest rates--they are just different ways of recognizing scarcity, allocating resources, setting priorities. But these companies don't have to worry about such niceties as scarcity. Sorry about this digression. I don't have time for more today--must go home. Will try to actually respond tomorrow. In the meantime, if QNTM goes down to the low 20s, I will be buying more. Perhaps will wait for about 2 weeks or so, but for what it is worth at this point, I think it is getting to be almost as cheap as it was last summer.

To: Mark Oliver who wrote (1664)	12/2/1997 7:48:00 PM
From: LK2	Read Replies (1) \| Respond to of 9256

>>What about component suppliers? Seems like they should be pretty stable.<< APM is a component supplier to WDC. APM prospects for future revenues and earnings (more likely negative earnings for the upcoming quarters) appear to worsen with each new earnings warning from WDC. 1. APM mainly produces thin film heads. They are just starting the transition to MR. So the faster WDC stops using thin film, the more APM will lose. 2. One of the few MR programs APM is qualified for is the 3-inch portable hard drive at WDC. And now WDC announces it is dropping that business line. It's almost like a joke, except that I doubt APM is laughing very much. 3. APM doesn't give out press releases to the public to say how the business is doing (except for the quarterly earnings reports). So the only way to figure/guess how APM is doing is to check on their customers and competitors. And since WDC is nice enough and open enough to explain publicly what is happening in WDC's business, you can guess that APM's business is going to be pretty rotten. -LK