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Non-Tech : Any info about Iomega (IOM)? -- Ignore unavailable to you. Want to Upgrade?

To: Les White who wrote (54042)	5/2/1998 12:20:00 PM
From: Rocky Reid	Read Replies (2) \| Respond to of 58324

>>It looks like Sony's launch strategy is based on no OEM's.<< Actually, they will have at least 2 OEM's upon launch. In an article I posted a couple of days ago, it was said that Sony themselves will incorporate it in their desktop machines, and ANOTHER unnamed OEM was stated to be on-line as well. Iomega could lower prices even more than the earnings-losing level they are now. But Sony /Teac can lower their prices even more to follow their lead. Sony/TEAC can afford to do this becasue they each offer numerous big profit-making products that can subsidize any losses on HiFi. They will still be in good financial shape. The negative Cash flow in quarter after quarter for Iomega however could put them in serious financial shape inside a year (can you say, SyQuest?), They could have no cash, their $200 million line of credit could be wiped out, and they may be forced to dilute their shares. In any case, the IOM stock price will suffer greatly. They could sell 50 Million Zip drives and still make no profit, and be relying on diluting IOM shares just to stay alive. All this becasue they rely on one little product for profits- retail Zip. In a war of attrition and margins, Sony could crush Iomega. It's looking real bad for them right now.