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Friday, December 06, 1996 Iomega was down $3/8 Thursday, closing at $23 3/4 (-1.55%). TODAY'S RECAP: Late yesterday contributors to our Iomega message board reported that comments by Federal Reserve Chairman Alan Greenspan were spooking overseas stock and bond markets. The Australian stock market, for example, reportedly dropped nearly 3% in the last session's trading. Mr. Greenspan, it seems, has warned that the Fed must be wary of "irrational exuberance" in the stock market, a remark which could be taken as a hint that an interest rate hike is on the way. This statement, combined with nervousness over the U.S. November employment report due today, has many expecting a troublesome trading session for American stocks. What these factors might mean for Iomega, of course, is anybody's guess. In spite of these uncertainties, the busiest stock forum in cyberspace chugged away, spewing out analysis and observation of the rugged storage company from Roy. Of special interest in today's edition of I/T are our first reports of LS-120 drives to reach the retail shelves: check out the posts by ~DCenturian~ and ~Kevinfurr~ (11++ and 12++), below. INDEX: Use the Search or Find feature of your word processor to locate the article number (Find: 1++, 3++, etc.) -- or use AOL's Edit>>Find in Top Window Feature. If Find in Top Window is dimmed, just click on some text, anything, in the IOM Today window and try again.
1++MF DrJimbo seeks an explanation for a possible shortage of Jaz
disks. And now, the Best of the Board...Started 3 am ET 12/5/96.
1++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: Re:Jaz and ingram Date: 96-12-05 10:30:55 EST From: MF DrJimbo
MF ETurkey-
I'd like to think that its demand that's leading to short supply of Jaz disks. However another factor may be competition for supply from the drive makers. Look at recent announcements from SEG and IBM on increasing manufacturing capacity and Hutchinson's recent announcement about better than previously expected earnings. The drive manufacturers are working hard now. Its one reason I think that the disk makers, HMTT, CEON, KMAG are the best bargains in the storage sector right now. I own some CEON, but may replace it with HMTT in my portfolio soon. 2++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: Latest Iomega design patent Date: 96-12-05 11:03:25 EST From: RunngMoose
As has been reported several days ago by another poster to this board, on Nov 19, 1996 Iomega was granted a design patent, US D375728, "FRONT PANEL OF A COMPUTER STORAGE DEVICE". I just received a copy of this patent. It is for the ornamental design for the front bezel of the external Zip drive.
Claim: the ornamental design for a front panel of a computer data storage device, as shown and described (6 drawings).
Frankly, i'm still not sure what the worth of these design patents are in field of computer peripherals. Certainly this protects against a blatant direct knock-off of the Zip front bezel, but as we have seen, several other storage devices have come out that have a very similar "look and feel' to the Zip. I'm not sure how much change in the Zip bezel design would be required to avoid infringing on IO's patent. Are there any patent attorneys out there with experience in design patents and their real worth in an application such as this??? Your comments would be appreciated.
Dave 3++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: SyJet intro Date: 96-12-05 18:40:06 EST From: MonirM
Iomega stock is expensive at $3 billion plus, and it faces a significant competitive threat starting Q1 in the high-end storage arena in the form of SyQuest's upcoming 1.5 GB SyJet.
The Jaz business accounts for perhaps a billion dollars of IOM's market value. The diminished prospects for the Jaz, which has a much smaller niche than the Zip, and has no chance of becoming any sort of market standard, unlike the Zip line, will become a drag on the stock price. Will additional Zip business be enough to compensate for the forecasted loss?
Monir 4++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: Re:SyJet intro Date: 96-12-05 19:29:36 EST From: PKeeler
>>> Iomega stock is expensive at $3 billion plus, and it faces a significant competitive threat starting Q1 in the high-end storage arena in the form of SyQuest's upcoming 1.5 GB SyJet. <<<
I had to blink twice. I thought I was reading a post from December...1995!
You did not answer the questions I had asked of your last post about the SyJet. This has shown (with past "competition's coming bears") to indicate a lack of real knowledge and a total misreading of the removable storage market.
PKeeler Patrick Keeler 5++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: CRN on N.Hand Date: 96-12-05 21:20:09 EST From: PKeeler
from http://www.techweb.com/search/advsearch.html
Computer Reseller News
N-Hand Puts It In Competition -- Iomega enters handheld arena
By Kelly Spang
<snip>
While Roy-based Iomega only recently unveiled its n-hand disk, Tolson [Bill Tolson, marketing manager for Iomega's New Technologies division] said the company is working with several OEMs to have the technology implemented into designs. Starting first with digital cameras, Tolson said he expects that by Christmas 1997, digital cameras will begin shipping with Iomega storage. Between now and September 1997, Tolson said product announcements will introduce devices with n-hand storage technology.
<snip>
n the future, there may be an increase in capacity for n-hand disks, as well as greater versatility among devices. "It is our vision to have [n-hand technology] as a standardized format across devices," Tolson said.
PKeeler Patrick Keeler 6++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: Re: Keeler Apology Date: 96-12-05 22:43:41 EST From: Robra
<<And it isnt as if these rigid disclosure policies arent without their cost. IMO the failure of Iomega to be more forthcoming with information vital to the conduct of reliable analysis, is the single most important reason why Wall Streets coverage of the Company has remained so limited.>>
<< I think the limited info could be a hold up in broader coverage. Not knowing what the gross margins on disks are or not knowing the disk to drive ratio's would make it hard to do any sort of accurate modeling. Those are just two examples of info not forthcoming from iom, there are many other examples where lack of info holds up analysis.>>
There is no doubt coverage is somewhat limited with the current disclosure policy. However, with a background in marketing and sales I would submit to you that the "accurate modeling" you speak of is also what the potential competition would LOVE to have to perform the most accurate analysis to determine feasibility and assemble the most aggressive marketing plan to take market share. The threat of competition in this area is great, so as a stockholder, why would I trade a pop of a few points in stock price now for longer term market share? With the size of some of the companies IOM could be up against, IOM shouldn't go out of their way to help them into the market.
Sure, most companies can logically draw conclusions on many if not most of the key elements. But if you were a Marketing VP of a competitor, would you rather make assumptions to use in your analysis or would you rather compare your estimations with details presented by IOM to analysts that can't get a clue on their own? Let's say you were that VP and you failed. Would you rather be able to point to objective numbers taken from your competition or take the blame for contrived numbers you came up with alone? The VP that is able to compare his deduced numbers with those acquired by the competition can afford to take a much more aggressive marketing stance than the VP that is working only with his own numbers. Face it, the same info some analysts are whining about not having are the exact same numbers the competition needs to do the most accurate analysis on how to enter the market.
Robra 7++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: n.hand Date: 96-12-05 22:53:09 EST From: MF Ben
<<<Tolson said he expects that by Christmas 1997, digital cameras will begin shipping with Iomega storage. Between now and September 1997, Tolson said product announcements will introduce devices with n-hand storage technology.>>>
Yeah, I know the original press release said "second half '97," or something to that effect but as HYPEMENOT recently pointed out -- and got severely flamed for his troubles -- second half doesn't HAVE to mean July/August/September.
Looks like anyone counting on n.hand revenue to hit during Q3 '97 will be severely disappointed.
That "product announcements" will come between "now and September 1997" pretty much indicates to me that n.hand products THEMSELVES aren't expected till October ( fulfilling the "by Christmas 1997" quote) and till then we will just be tallying up the OEM agreement list (and checking it twice, whose been naughty and... you know the rest).
My point? This board is often quick to flame opinion that isn't "best case scenario" but closer to "reasonable." I mean, "second half '97" does NOT mean Q3 and to assume it does, and flame those who suggest that later in the year may be closer to reality (especially as a year out on a new tech product can sometimes be last FOREVER...ask Apple about Copeland, Microsoft on Win95, and IBM on their PowerPC line).
<<<Tolson [Bill Tolson, marketing manager for Iomega's New Technologies division] said the company is working with several OEMs to have the technology implemented into designs.>>>
"working with" is an interesting phrase but it could mean a bazillion things, especially if, as usual, IOM plays the OEM agreements close to the vest for awhile.
Thanks to PKeeler for diggin up the article (http://www.techweb.com/search/advsearch.html).
See ya Sunday. Off to a wedding.
Cheers,
Benjamin 8++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: DELL Inclusion 1; Date: 96-12-05 23:03:43 EST From: DUHrook
It's been a while since I have contributed to this board in any meaningful way, but have been encouraged by the recent conversation's of RB61, and MF Ben on this board.
The following is purely conjuncture on my part, and is speculative in nature, although based upon personal experience, and business logic.
Question; When will DELL include the Zip in a SKU?
Answer; When it is more profitable to sell installed internals, than selling externals.
Extrapolation; (1) When I ordered my 200 Pro from Dell back in March, I also ordered a SCSI Zip internal ($ 199.00), a SCSI2 card ($259.00), and an internal Jaz ($499.00). At that time I could have purchased an external Zip for $199.00 (Pre-rebate) at the local computer store. I don't know what the cost would have been for an internal Zip, knowing that they were in short supply at that time.
With my limited experience poking in various boxes that I had previously owned, I was able to have the Zip & Jaz up and running in no time flat (just hook up the Zip as the last drive, for termination purposes). I have successfully run WIN95, NT Workstation 3.51, and NT 4.0 on this box since, without any conflict problem with the Zip, or Jaz.
Thus; I ascertain that it isn't a servicing problem with Zip that is the holdup.
(2) As I recall (going on memory here, correct me if I'm wrong), Dell is currently charging in the neighborhood of $220 for an External Zip, that can be purchased at the local computer store for a minimum of $20 less. This makes the external Zip a high margin accessory for them. They can say that the offer it, and it is available for purchase, and anyone can hook it up.
I would imagine that an internal Zip now has a lower profit margin, as the people that would insist upon it would be inclined to call CPU, or BBY for prices on these items, and refuse to pay the premium that DELL would like to charge for them.
(3) As each Dell computer is individually built (they make a model run, with slight differentiations) when components are received), they would be required to install the cards & drives, making sure that there were no conflicts prior to shipment. There would be the added cost associated with this installation, and as other box makers do not charge extra for this service, DELL would be hard pressed to do so.
As for the IDE Zip, there is a question as to limited availability (in my mind), and the lack of BIOS support at present to run it as an "a" drive. When BIOS is available ( 1st Q as I recall) to box makers, it would be an option that would differentiate their product from others, and possibly command a price premium for that possibility.
Thus; I can ascertain; it would hurt profit margins to install SCSI Zip drives. And there is no present advantage to adding a IDE Zip as a "b" drive, as it would suffer the same added cost association's to installation that a SCSI Zip would have, without any advantage over the SCSI Zip at present.
Question; What would make it more profitable?
Answer; Customer demand for internal's, rather than just preference.
Extrapolation; At present there is no significant performance advantage having an IDE Zip -vs- SCSI Zip, as it doesn't matter if the Zip is a "b" drive, or an "e" drive. You can't boot from either one of them (Wintell machines). When the BIOS is available to boot from a Zip, giving the customer a performance advantage that can be utilized as a marketing advantage by the box makers, customer demand (rather than preference) will increase.
They will be able to charge more for the box, because of the added versatility (BIOS), absorbing the added cost associated with the installation of a Zip internal within the new price structure for the new BIOS creating higher margins.
DELL makes their money on the high end user, the person willing to pay a premium for the newest, badest, most kick butt machine that money can buy (within reason). DELL will not be without a SKU with a Zip internal when it is more profitable to offer it, than to sell external versions.
Conclusion;
I'm thinking late May, early June. Anything before that would be gravy, considering that extensive testing will have to be done prior to any agreement. Until then, IOM shareholders will just have to be content with waiting for 4Q results.
Dave 9++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: FROM THE SI STOCK BOARD Date: 96-12-06 00:06:39 EST From: BHM AL
To: NTMD8TR (12411 ) From: DAVID C Dec 5 1996 8:12PM EST Reply #12449 of 12464
To All:
HD Brous & Co. increased estimate for fiscal'96 from .40 to .47 on 11/19/96. The Q4 estimate of .20 was also made on 11/19/96. Fiscal'97 was estimated to be .90 This is the most recent update on IOM by a major broker that I know of. I got this from Zack's Analyst Watch.
Sorry for confusion, everyone. Thanks for the FirstCall table. Looks like a good service. What's the address? 10++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: n hand Date: 96-12-06 00:20:20 EST From: CayugaDan
Here are two very different questions:
1. How should the remainder of nhand's development (and hopefully n.hand's ramp up) effect earnings?
2. If a n.hand disk can be read by a future Zip drive, might it not be a good choice for notebooks? You might be able to fit a CD-ROM, n.hand and a hard drive in a slick, small notebook.... OK, now I want one .
Dan Rapaport Cayuga Computers 11++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: LS-120 Channel Check Date: 96-12-06 01:58:15 EST From: DCenturian
The LS-120 is now being advertised at San Diego computer stores at a price of $219. Major feature is the backward compatibility and space for 120MB. To the untrained eye (believe me, there are a lot of 'em), the LS-120 looks like the better buy than the Zip drive. Of course, they don't mention that it is slower than the Zip but that won't matter as they pull in buyers for hook, line, and sinker. Can you say competition?
DCenturian 12++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subj: LS-120 for sale Date: 96-12-06 03:00:40 EST From: Kevinfurr
>> The LS-120 is now being advertised at San Diego computer stores at a price of $219. <<
Well as long as Centurian mentions it, and since I have the paper and one of the local San Diego computer rags sprawled on the floor, lemme check. (Two Men Dash Into House, Save Woman. Interesting).
Here we go. I can only find one store, a local 3-outlet shop called Datel, advertising the LS-120. It says, "ONE WEEK ONLY $219". Now what does that mean.
Actually as luck would have it I was in Datel about 2 days ago and saw their first shipment (I believe) of a dozen LS-120's, sitting on the shelf (I guess that's a promising sign, considering Zips never sat on shelves for long, when they came out). OR Technology brand. Curiously--and I already asked CayugaDan about this--OR Tech has chosen not to do much in the way of splashy marketing on the boxes themselves: the drives come in plain, brown, almost unidentified cardboard boxes, sealed by packing tape. The only labeling of any kind is a small "a:drive" logo. No pix or shrink-wrap or anything colorful; nothing to indicate what an "a:drive" is. Or whether it's internal or external. Or what type of interface. Datel is selling those cardboard boxes.
It was too early to gauge how they're selling, but I'll try to remember to check back. When I was in that same store, a few days before, one of the salesman was all ebullient about the new 3.5" internal Zips they'd just started vending. He explained that he had been sharing one external Zip 'twixt his PC and his Mac, but that he was going to buy an internal for each.
Incidentally, my workplace is finally very interested in Zips. Nothing huge, but my branch is buying two tomorrow, and two more next quarter. The CO is reportedly very high on Zips. This "corporate" discovery has something to do with our personal use of Zip drives, as first of course I bought one (actually 4 but that's a long history by now) and then Steve, and then Hose, then the CIS manager, then Brandy, and Bones, and Drone hasn't bought one but he uses them a lot.
Chipping away.
End Report. Posts covered through 3 am ET 12/6/96. _______________________________
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