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

To: shane forbes who wrote (3208)	5/4/1998 1:42:00 PM
From: Sam	Respond to of 9256

"And I would make the argument that for WDC the return is better. R&D ain't cheap. PP&E to build GMR ain't cheap as well!" Yes, but IBM isn't operating on an Asian model. They're in it to make a buck (or two). And they will price their heads to account for R&D. Which may well mean that they will be cost leaders on drives with GMR heads. Which may in turn mean that Quinta and TeraStor become even more important for SEG and QNTM.

To: shane forbes who wrote (3208)	5/4/1998 2:35:00 PM
From: Tom Simpson	Read Replies (1) \| Respond to of 9256

We got a straw horse floating around here. Fact is GMR R&D (or MR) isn't an option for WDC, whose business model depends on others for that. But the deal does seem cute. WDC gets a lifeline to the next technology plus a reliable current MR supplier. IBM components gets more market share. IBM puts more pressure by WDC proxy on Seagate, Quantum, and Maxtor in lower end desktop while IBM focuses on richer margins in the highend and laptops. I don't know. Looks to me like Seagate better get a good handle on their business PDQ because I sure think they are going to get squeezed top and bottom. I kind of wonder if enough space has been set aside in feline heaven for APM and RDRT and KMAG. So why did QNTM pop up today? Doesn't follow does it? But the market is always right, so I must be wrong. Funny how often that happens :o) Tom