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Hi All:
I see that some of you are interested in hard drive manufacturers. This
is not a healthy sector. Seagate is closing down a plant in Ireland
they've had since the early days of pcs, Western Digital and Quantum are
hurting. Micropolis went out of business with no warning Nov. 10th.
With Samsung a major player in the 3.5 HD market, expect to see the
other guys really hurting by this spring due to the deflation of the
Korean currency and the price advantage Samsung will have.
The hard drive mfgs. have about killed themselves off with price
cutting. They thought volume would make up for margin; it doesn't. I
anticipate that Samsung will be unloading a whole series of components
at a deflationary price. Short term great for the consumer, e.g. get
your Samsung 21" monitor for maybe 700-800 dollars, long term bad for
the industry with fewer companies left. I got stuck with a ton of
Micropolis equipment.
I've been in the pc business for 15 years and have never seen things so
messed up. The mfgs have priced themselves and resellers practically out
of business.
Just a note about Dell: The only reason Dell has made such unexpected
profits has not been due to sales but component deflation. HP, Compaq
and IBM are going after them now with channel assembly. They have lost
their price advantage and are losing big accounts to Compaq already. By
this summer, the darling of CNBC is going to have less than stellar
performance. I guess this is why Michael Dell filed to sell 300,000
shares last week.
Robert
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