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 : Applied Magnetics Corp -- Ignore unavailable to you. Want to Upgrade?

To: T Bowl who wrote (10928)	12/10/1997 10:57:00 AM
From: Think4Yourself	Respond to of 12298

Todd, I also got the impression that WDC was not cutting back on MR production, and is in fact increasing it, As you just pointed out that you had no facts to back the assumption I realized that I didn;t either. I put it together from their accelerated transition statements and their new product announcements. BTW, they just announced a new 9.1 GB SCSI drive today. Not bad, but not as good as Seagate's Cheetah. Looking forward to hearing what WDC has to say. Ken

To: T Bowl who wrote (10928)	12/10/1997 11:21:00 AM
From: Dave Chanoux	Read Replies (1) \| Respond to of 12298

No MR cutbacks at WDC. That would be opposite of everything said in the CC's and PR's since September. However, making DD's is not quite just putting things in a box. The parts and components for MR DD's are not the same as parts and components for TFI DD's. Suppliers have to be turned on, test equipment moved around etc. That's where the extra costs/charges come in. Doesn't happen instantly, otherwise it would have been all done yesterday afternoon. WDC must have commitments to customers as well which they have to honor as well. DD's aren't quite like rental cars; reserved a subcompact, don't have one on hand, take a full size for the same price instead. WDC has a need to ship working product. Transitions expose manufacturing/revenue risk. Although they have been through this before, this one is market-driven rather than company-driven and perhaps forced rather than planned. I would expect them to build higher than normal inventories of critical components to minimize the risk of not being able to ship a $200 item for lack of a $10 part. I would be curious to know what is limiting their production of MR DD's and why it will take 6 months to implement this plan. Keep pushing those numbers Todd and Gus, Gus, who caught the Flutie pass? Doug's father worked at Digital Equipment (there, I justified this post) but left to become his son's agent. Thanks and regards, Dave Chanoux

To: T Bowl who wrote (10928)	12/11/1997 3:43:00 PM
From: Gus	Read Replies (1) \| Respond to of 12298

Sorry for the delay, Todd. It's a good thing you quickly picked up on the fact that using numbers that soft only takes us to the cheapest seats of the ballpark. I think you made a good point about the MR/TFI mix. The reason I decided to assume, as a starting point, a 60/40 TFI/MR mix was the fact that Maxtor is singlehandedly driving WDC and everyone else nuts with its 7.0 GB (4 platters - RDRT 1.6 GB MR heads extended to 1.75 GB using TXN silicon and DSPs which provide up to 20% boost in linear density depending on overall drive design) which is price positioned between the 6.4/6.5 GB (4 platters using 1.6 MR/TFI or 5 platters using 1.3 MR/TFI) and the 5.0/5.1 GB drives (3 platters using 1.6/1.7 MR/TFI, or 4 platters using 1.3 MR/TFI). Question: I wonder if all these have been factored into RDRT's one-time TFI-phaseout charge of $30 M announced in November? Because WDC relies more heavily on retail sales (~10% of revenues) than the other majors (average of about 5-6% of revenues), and Maxtor has come from way behind to go neck to neck with WDC in this channel, the 5.1/6.4 GB is one of the most likely areas of tactical retreat. After falling behind Maxtor in retail market share in September, according to audited retail sales data from market research firm PC Data, Western Digital bounced back in October to take a 37.7 percent share of unit sales and market leadership. Maxtor garnered 35.1 percent of hard-drive sales in October, and Seagate was third with 10.5 percent. techweb.com By the way, 1.2 million DDs require about ~3.6 million platters. Platter ASP is about $10-14 (could be lower thanks to STMD) so that's a potential shortfall of at least $36 million. I don't follow the media guys closely because they all have been beaten down. Any ideas of where the shortfalls are going to be? Gus P.S. Dave: You know, I never did bother to find out who caught Flutie's pass. Strange but true.

To: T Bowl who wrote (10928)	12/11/1997 3:54:00 PM
From: Jonathan Bird	Read Replies (1) \| Respond to of 12298

I guess in the end my question is does anyone else get the read that there are MR DD cutbacks at WDC? Just the Portfolio drive. It was taken off the WDC web page within a couple days of the announcment that WDC was cancelling it. Since APM supplies the MR heads for this drive I think it is very odd that Craig Crasmen told Brian that they recieved no cancellations from WDC. If I were a gentleman I'd say the Crispen is misinformend. But since im a trader id say something else. Jon Bird