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

To: Gus who wrote (1765)	12/12/1997 2:46:00 AM
From: Gus	Read Replies (3) \| Respond to of 9256

Re: Demand QNTM cited an IDC report that shows that quarterly growth from the September quarter to the December quarter is only 9% instead of the expected 20-25%. Slower than expected demand + Overcapacity and oversupply (Japanese and Koreans, yes but SEG has the largest overcapacity problem) = the hellacious margin squeeze we have seen so far in the disk drive supply chain. The PC mix shift biased towards the low-end also has the practical effect of squeezing margins some more. See below. ...Nearly a year after the sub-$1,000 market began to take off, the segment continues to be the fastest growing category of personal computer. According to PC Data Inc., a market research firm, sub-$1,000 computers made up 39.1% of retail PC sales in October, up from 7.1% of sales a year earlier. And during the same period, sales of $1,500 to $2,000 machines slipped to 20.3% of the market from 37.9%. Machines selling for $2,000 to $2,500 fell to 4.2% from 16.4%.... This is a sampling of Retail PC sales in October from the preceding WSJ article. Extracting some numbers provides an interesting snapshot... October 1997 Retail PC sales [Note: from 1996 figure to 1997 figure or Year over year] sub-$1,000 segment = from 7.1% to 39.1% or +551% YOY $1,000 to $1,500 segment = from ~35% to 35% or assumed flat YOY $1,500 to $2,000 segment = from 37.9% to 20.3% or -46% YOY $2,000 to $2,500 segment = from 16.4% to 4.2% or -74% YOY over $2,500 segment = from <5% to <5% or assumed flat YOY If we line up 1997 PC mix and YOY growth rates with probable DD capacity points and price ranges (WAGS).... sub-$1,000 segment = 39.1% -> 551% YOY -> 1.0-2.1 GB -> $100-170 $1,000 to $1,500 segment = ~35% -> flat YOY -> 2.0-3.0 GB -> $170-250 $1,500 to $2,000 segment = 20.3% -> (46%) YOY -> 3.0-5.1 GB -> $250-$300 $2,000 to $2,500 segment = 4.2% -> (74%) YOY -> 5.1 and up -> $300+ Note: 1) US retail sales represent only 15% of US PC demand 2) US consumer PC demand is about 15% of world demand while corporate PC demand is about 15%. 3) WAGS = wild assed guesses Some observations based on October 1997 sample: 1) PCs selling below $1,500 accounted for 42.1% of retail PC sales in October 1996 and 74.1% in October 1997 with the sub-$1,000 PC accounting for all the YOY growth. 2) Based on this limited sample, 74.1% of all PC-attached DD sales, or OEM sales, is currently be in the 1.0 to 3.0 GB range ($100 to $250) where I think SEG, Fujitsu and Maxtor are just basically swinging away to grab volume. 3) If this trend persists and there is no expansion of the higher priced PCs, this could be the mix shift from hell as far as the PC food chain is concerned. Historically, MSFT and INTC have captured about 50% of the total profits of the food chain. With the top 5 PC makers (Compaq, Dell, IBM, HWP, NEC/PBell) growing faster than the rest and capturing some hard-earned margins from its upline (INTC, MSFT) and and most of the margins of its downline (component suppliers), that would suggest that component suppliers have to get bigger in order to grow faster than its competitors. Best to track this unsettling trend.

To: Gus who wrote (1765)	12/12/1997 5:29:00 AM
From: Z Analyzer	Respond to of 9256

<<Samsung also is shelving a 450 million pound expansion plan at its northern England plant where it produces consumer electronics, including televisions and computer monitors. And the company's plan to invest some US$1.6 billion in China's electronics industry has been put under review. >> Picked this up from a foreign news article (need to learn how to do linking). Hopefully the review of the China investment includes the second disk drive plant (to double Samsug capacity) planned for China.

To: Gus who wrote (1765)	12/12/1997 8:49:00 AM
From: Will Cunningham	Respond to of 9256

$500 dollar CPU from Micro Center stores under the name 'PowerSpec'. An employee at the store said that customers were buying three or four of these models at a time until management decided to limit sales to no more than 1 or 2 machines per customer. Employees are not even allowed to purchase the machines at this price-point. Was it you who mentioned in an earlier post that it would be possible to build a machine like this for $400-450? If so, they make either nothing on this machine or maybe $50. Most of the reports that have been generated about the sub-$1K mahines cite Compaq as having an 80% share. I don't believe that this is a reliable figure when considering the number of machines sold at this price by various manufacturers. What do you think of this? only...$499 NEVER BEFORE! 1660 Integrated Multimedia System NEVER BEFORE has a system of this caliber been offered at such an incredible price!ÿ It is a full-featured system ideal as a 2nd or 3rd system at home, a student machine, a low cost connection to the World Wide Web, or anywhere else a Pentium-class multimedia system is needed, but until now wasn't justified.ÿ BUY NOW--this price can't last forever! Processor 166MHZ Cyrix MediaGXT processor Configuration Desktop RAM/Expand 16MB EDO (14MB available) expandable to 128MB Hard Disk 1.0GB CD-ROM 12X Sound Card Integrated on MediaGXT Chip Video Integrated Video Slots/Ports 1 Expansion Slots, ISA/PCI shared, 2 Serial, 1 Parallel,ÿ 2 PS/2 Ports Power Supply 100W,ÿ 110V/220V Speakers Stereo Fax/Modem 33.6k Fax/Modem OS & Software MS Windowsr 95; Microsoftr Works software and selected titles Key/Mouse PS/2 Style Windowsr 95 Keyboard; PS/2 Style Mouse This machine: microcenter.com All other PowerSpec machines with specs and price-points: microcenter.com