To: tombet who wrote (3702 ) 11/9/1998 10:19:00 PM From: Cogito Read Replies (6) | Respond to of 10072
Tom - WARNING. LONG POST. Sure, I have comments about The self-styled Fabulous Market Babe's Iomega article. Here's my article in response. Right off the top, one thing bothers me. I guess if something is repeated often enough, people start believing it. So FMB trots out the old chestnut that SyQuest had better technology, but Iomega beat them with marketing. Bearcrap. I challenge anyone to provide me with one iota of evidence of any technology SyQuest had that was superior to Iomega's. I've heard arguments advanced about this, but not by anyone who actually understands the technology. The fact that EZ 135 and EZ Flyer were faster than Zip? That was because SyQuest used hard disks and Iomega went with floppies. But hard disk removable cartridges had been made by both companies for a decade before that. No big advance in making a smaller one and selling it for less, as SyQuest did. The hard disk platters in the SyQuest cartridges were not even restrained by a clamping mechanism when not inserted in the drives. You could call that a bad design decision except that SyQuest had no choice. Iomega was the company that invented and patented that particular feature. That's why Jaz cartridges don't rattle when you shake them. Zip's approach to the 100MB disk required pushing the limits of floppy technology, achieving densities and speeds that no one had reached before in an inexpensive cartridge design. They used a lot of what they learned when they were involved with the development of the LS-120. The use of a hard disk platter was the main reason why SyQuest could never match Iomega's price points for Zip, and why they had to sell their products at a loss. Iomega had Jaz on the market for a long time before SyQuest brought out their me-too product with SyJet. If SyQuest's technology was so superior, why did it take them so long to come out with that drive? SyJet was marginally faster than Jaz, but that's really not a big trick when you let the other guy go first. SparQ used MR heads and platters. So what? IBM invented the technology. Not SyQuest. FMB also says that CD-R is cheaper than Zip, because the disks cost 50 cents, as opposed to 10 to 15 dollars for a Zip disk. But wait. CD-R disks are read-only. I use it once and I am done. I have a Zip disk that I have been using to back up my Quicken files several times a week for years now. I would have gone through at least a few dozen CD-R disks to accomplish the same thing, assuming that I put multiple sessions on each disk. CD-R to Zip is not a valid comparison. CD-RW to Zip is, but CD-RW disks cost more per unit than Zip disks. And if I'm putting some files on a disk to give to someone else, it doesn't matter to me that the CD-RW costs less per megabyte. If 100MB is enough (or 200MB compressed) is enough, then I just want to use the cheaper Zip disk. CD-RW disks cost as much or more than Zip disks. I'll say this again. CD-R, CD-RW, and the various forms of writeable DVD are good for some purposes, Zip disks are good for others. FMB also says that OEMs won't use Clik! because they prefer cheaper memory chips. Problem is, flash memory chips, despite being much less expensive now than they were last year, are still FAR more expensive than Clik! disks, both on a per unit and a per megabyte basis. That's enough from me. I'm getting tired of seeing the same tired arguments brought up again and again as if they are new. I find it surprising that the bears haven't been able to come up with any new material in well over a year. If Iomega completes the turnaround they have begun, then the numbers will speak for themselves. Until then, what is the point of making predictions about what people will or will not buy, or what will or will not make a profit? I'm going to make some predictions. I predict that Iomega will post a profit for the fourth quarter. Between 4 and 6 cents per share. I predict that they will post a profit in every quarter of 1999, and that they will beat current estimates for the year handily. I predict that Clik! will be a successful product. I predict that by this time next year Iomega will have shipped more than 25 million Zip drives, and more than 3 million Jaz. Are these predictions correct? What will all of this mean to the price of IOM? Has anyone read this far? How should I know? But what I do know is probably just as much about this company, these products, and the PC market as any of the pundits who are predicting bankruptcy for Iomega. I'd be willing to bet that I know a damn sight more than most of them. Wow. Somebody must have put a serious bug up my butt. I'm done. Sorry for being so long-winded, but I feel so much better now. I wonder if I could get a job as a pundit. - Allen