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To: Bill Lin who wrote (11539)	3/23/1998 1:39:00 PM
From: Greg Jung	Read Replies (1) \| Respond to of 12298

ibm(disks) >> RDRT >> APM "i've looked at rdrt's financial past. it sucks. is the rdrt mgmt new or better or ???" I think ??? is the most correct. APM had three quarters of rolling in the dough while rdrt went for more pain - presumably at the time, a lesson APM had learned in the previous technology transition. WDC had parallel plan. Then the last TFI heads didn't qualify so well, Toshiba began dumping, and WDC retreated from the TFI strategy so APM also. These are one-horse stocks with a concentrated customer base. So in the good times I think they should be earning a profit instead of making excuses and taking recurring one-time charges. Greg

To: Bill Lin who wrote (11539)	3/23/1998 2:02:00 PM
From: Mark Adams	Read Replies (1) \| Respond to of 12298

I've been thinking about RDRT & APM. In a way, Crisman was right to pursue a merger with RDRT IMO. I say this, because I believe the trend in DRAM can be applied to Media/Heads. That being that the cost to make the technology transitions is increasing to such an extent that only players who achieve a critical mass (size/sales) will be able to stay in the game.

To: Bill Lin who wrote (11539)	3/23/1998 10:53:00 PM
From: Stitch	Read Replies (4) \| Respond to of 12298

Bill, Thread; RDRT and APM are dead money investments. At the risk of repeating myself (time and again) these two companys are under tremendous pressure for the following reasons. 1) Competitive strength from Japanese vendors, SAE and Yamaha, both of whom have mature and high yielding MR processes and shipping relationships with most major OEMs. 2) Failure to execute well on MR technology at a time that the transition to MR has accelerated. 3) Declining short term demand due to excess inventories and declining disk drive shipments that isn't expected to correct for at least two more quarters. 4) IBM's resolve to enter the OEM head business with a MUCH superior technology base. (They are already shipping to Maxtor and are qualifying elsewhere. In addition they have already transitioned to volume GMR production, the next plateau. They are WAY ahead.) 5) Seagate, Fujitsu, IBM, and Quantum all have internal head manufacturing though admittedly Seagate's and Quantum's are not doing well at present. Nevertheless, vertical integration here is not going to go away. These four account for 60% of DD market share. Maxtor, increasingly dependent on IBM and SAE for heads, accounts for another 7% market share. 6) Long term demand will decline according to TrendFocus, a market research firm focused on the Head, Media PC, and DD industries, due to a decline in the average number of disk and heads per disk drives. In addition unit growth in disk drives may be slowing as well. Morgan Stanley shows CAGR peaking in the 1990-1995 period at 28% and from 1995-2000 averaging 18%. Fellows: severe competition, loss of market share, shrinking market, declining earnings, way behind the technology curve, trend to vertical integration, what more do you need to prompt you to go search alternative investments? RDRT and APM are lousy investments at this time if ever. Best, Stitch