Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Seagate Technology -- Ignore unavailable to you. Want to Upgrade?

To: Kevin Linder who wrote (5361)	8/2/1998 6:24:00 PM
From: stock bull	Respond to of 7841

Kevin, how long have the DD companies been in trouble now? It's well over a 18 months. When they'll get out, I just don't known. Asia sure isn't helping any...and many think Asia/Japan won't recover for another few years at best. Stock Bull

To: Kevin Linder who wrote (5361)	8/2/1998 10:06:00 PM
From: Stitch	Read Replies (2) \| Respond to of 7841

Kevin, They most certainly will, at least some of them. The inevitable demand for data storage is the ultimate good news. There is always a lot of hand-wringing over these guys "doing it to themselves". But the behavior of this market is unlike many with the most direct comparison I can think of being d-ram. High stakes, manufacturing muscle & discipline, significant and on-going development challenges, and rapidly diminishing prices/margins are a tough set of parameters. The buyer has been, and likely will continue to be, the recipient of the rewards in these cycles. In my opinion, to say these guys 'do it to themselves" is a bit of an oversimplification. It overlooks the transition to build-to-order (BTO) models of business, the Asian economic crisis, the slowdown in storage hungry app releases, and other factors over which we could hardly hold DD managers accountable for. That they were not prescient on all of these seems human to me. That the DD industry has delivered a staggering 60% per year performance improvement to its market while reducing the cost of storage by factors of 30% overall in the last three years is an amazing achievement IMO. The moment a company trims back in this industry, either in capacity or development, their nose gets cut off. The only course available is to try to outperform the competition and weather the storm by adapting quicker. My advice is to look for the guys you think will do this best. My candidate is Seagate with substantial trimming now under their belt (10% world-wide staff reductions), a new low-cost drive announcement for the so-called sub-zero PC market, a significant regain of market share in the high end, an unreported improvement in head yields, a potential spin off of the software holdings, and a change in helmsmanship may make it the best candidate for the recovery that will inevitably occur. Best, Stitch