To: DR. IOMEGA who wrote (42639 ) 1/7/1998 5:57:00 PM From: Ockham Read Replies (6) | Respond to of 58324
Forget the battles. Here's how to win the war: The Zip drive is not the standard. If it were, it would already be included in most new pc's, and Iomega would be a cash cow instead of a high-growth, high-risk startup. In fact there will never again be a "The Standard." 10 years ago there was only 1 way to share files with everyone: the floppy. There was only one way to boot your machine when the drive crashed: the floppy. Most new computers came with both a 3.5" and a 5.25" and most software was sent on one or more 3.5" disks. Few people had a CD-ROM, a Syquest44 or Internet access, and so there was no point to making any software or information available that way. Floppy was THE standard because it was the only device that most everyone had. Today almost everyone has a CD-ROM, modem, and internet access in addition to their floppy. It is cheap and easy for big companies to burn a CD full of their bloat-ware. CD-ROM is THE NEW standard for software distribution. For small programs, device drivers, and for sending small files anywhere, the floppy and the Internet share the medium-of-choice distinction. The introduction of the Zip drive will change none of these. No software company will distribute their program on a Zip disk. No one would send a 100K photo of Junior to Grandma on a Zip disk. This is common sense. A drive cost $20 and the disks are disposable (call AOL for a free refill :-)) For these reasons I think the 3.5" floppy will continue to be installed on new PC's. It's also the reason that there will never be another "The Standard" So where does that leave our beloved IOM? With the fastest growing segment of the fractured floppy legacy: moving large files between computers not connected to the same LAN. This was Syquest's territory when the only people who needed it were graphics houses and engineers. With the Zip drive, IOM captured the rising mass markets of the home-office, tele-commuters, students, and other non-techies. Then with the Jaz they went head-to-head against Syquest in their own market and won. But if these are the only types of people who will need their drives, IOM will not do well What does IOM need to do to make their drive a must have for ALL computer users? They need to concentrate on making the Zip into the one device that can do something that the floppy does poorly and nothing else can do: be the Windows Emergency Boot Disk. If they can do this one thing, every manufacturer will make the Zip a standard on every new computer. If anyone else beats them to it, their installed base of drives will not save them. If Imation partners with Microsoft before they do, you will see an immediate change in OEM's. If they wait too long and someone develops a bootable, rewritable CD or DVD, they will have missed their chance at ubiquity. For these reasons, the most important announcements this year were that Norton had a Zip Recovery product, and that BIOS programmers were making the Zip bootable. In this war, installed base means nothing except the attention it gets in Redmond. The best marketing efforts are to the motherboard suppliers. The most important OEM's don't do hardware. Iomega can win this war. My money says they can do it. Ockham Next post: Clik! Disclaimer: This is not a solicitation to buy this stock, but if you are going to buy, please do so before Feb 20th :-)