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Technology Stocks : QUANTUM -- Ignore unavailable to you. Want to Upgrade?

To: Rational who wrote (6602)	12/14/1997 6:27:00 AM
From: Alan Hume	Read Replies (3) \| Respond to of 9124

Hi Sankar, Although I am very bullish about QNTM, there are several points in your posting that I regard more wishful thinking than fact. ,All QNTM DDs are also made in Asia and they are actually Asian goods. Thus, the Asian DD makers have no comparative advantage with respect to cheap LABOR as compared to their US counter parts" Correct, but US companies generally care about profit. If the profit is not there they back out. Japanese go initially for market share first. Wipe out the competition and then hike the price. The Koreans are similar, but with a subtle difference: when they have achieved market dominance, they still reduce the price, and kill themselves. That is what makes these guys so dangerous, as they are such poor business judgement. Did you know for instance that last fiscal year the top 30 Korean companies made a total of $65M between them? ,This has brightened the future of US DD makers, as their Asian counter parts get decimated by the weight of capital crunch and high cost of capital." Not so. Short term the Japanese have a 30% advantage ad the Koreans a 50% advantage due to exchange rate changes. This will lead to dumping. The tightening of credit may slow down the development of new products for the Koreans, but Fujitsu may have deep pockets and finance it themselves without loans. ,Observe also that consumers in countries like India and China and other Asian countries will even fast for years to buy a computer for their children. Once a BW article stated that India has 5% of its population with wealth that most Americans cannot dream of. It is a small percent, but it translates to about 45 million families. Most of them are just beginning the taste of high-tech. HDs will be needed every where." Correct, but the demand will be for very low end only in the foreseeable future. How much disposable income do the 45kk families have pro capita? Not much I fear. Having said all this, I ask myself is price so important? Look at the JTS ,Champion" range. It must be the cheapest 3gig drive on the market, but it is not going to stop them going chapter 11. Can anyone explain this to me? A question to you: For sometime now I have repeatedly read that the big 4 have 86% of the market, the 4 being QNTM; WDC; IBM and SEG. Fujitsu ad Maxtor were seen as possible threats. But when Samsung emerge from the woodwork?: How much market share do they have?. Samsung has for some years being making boxes, but on the international markets have had very limited success. I hope it remains the same for their DD efforts. I have NO RESPECT for Samsung, they are parasites. They are copiers and not innovators. If Samsung had never existed, the current level of electronics would not have changed in the slightest. Regards Alan