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Friday, November 06, 1997 Thursday, Iomega closed at $29, up $1/4 (+0.87%). TODAY'S RECAP: While some posters continued to speculate about Iomega's "big announcement," others chose to focus on the potential of n*hand, its competition and applicability. Others shared news about Zip computer and music SKUs, a potential reason for the absence of internal Zip drives (see post from ~TMF Jeanie~) and 4Q estimate revisions; ~JunkYard71~ (who began the limerick trend on the board) lightened the mood with his Top Ten Reasons to receive a TOS violation notice from the IOM board. Enjoy! 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++ TMF Cheeze cautions everyone regarding the "big announcement."
Recap written by TMF Weekly; posts
compiled by TMF Weekly. As always, the following posts represent the thoughts of our contributors, not those of The Motley Fool.
And now, the Best of the Board...Started 9:01pm ET 11/5/97. 1+++++++++++++++++++++++++++
Subject: The Hands Iomega is certainly inviting speculation with its website countdown, but the more I think about it, the more I'm convinced it's no big deal. We've been through this before with the similar "4inchsquare" announcement that turned out to be nothing more than the launch of a new ad campaign. I'll bet the same thing is happening here. 8 days puts us at November 13. How close does that correlate with the already announced date of the television campaign for the "Zip Built-In" promotion? Remember, this web thing is directed not exclusively to shareholders or industry analysts, but the world at large. 99% of them don't know anything about Zip Built-In. Let's not presume that Iomega is going to surprise us with anything new. 2+++++++++++++++++++++++++++
Subject: Why cameras? Flash memory is used in a lot of devices. There are also other devices that could use some flash memory but the cost of flash memory is prohibitive. One example where it is used now is laserjet printers. They come with flash memory to store fonts and stuff. They sell expensive additional flash memory cards as add-ons. I would think any device that currently uses swappable flash memory could use n.hand. Certainly in a device like a laser printer that is moved twice in its lifetime on average ;-) there is little advantage to flash memory vs. n.hand (certainly not battery wear LOL). Although digital cameras seem to be the sexy product, I would not overlook the fact that n.hand is suitable to many present and future applications. A digital camera OEM might be the last thing we see even though its what most people expect ;-) So in case its something else don't be disappointed. Returning to the above example, there are orders of magnitude more laserjet printers sold than digital cameras. An n.hand drive and 3 disks sold with 10% of laserjet printers, sold next year, would do much more for Iomega's revenues and earnings than if it were included in every digital camera sold next year. I think the cheap price and relatively large capacity of n.hand could be key in breaking digital cameras, smart phones, or hand held computers into the mainstream. But it wouldn't happen overnight. N.hand being adopted to replace flash memory in devices like hand held games, printers, and other already mainstream devices would really be much more significant to next year's earnings and revenues. The volume that could come in servicing an already large market like laserjet printers (sorry I keep using this example) could allow Iomega to really drive down the costs on n.hand to the point where some of these exotic tech devices (like internet cellphones) would really get attractive. Patrick Keeler 3+++++++++++++++++++++++++++
Subject: ZIP in pro audio... Earlier, Huibs was remarking about the use of Zip in the new Roland VS840 digital audio 4-tracker. I just ran across the new 360 Systems DigiCart/II Plus... a broadcast audio cart machine using Zip as it's removeable-cartridge drive o' choice. Folks, this is keen... check it out. http://www.360systems.com/products/dc2p/dc2p_main.htm 4+++++++++++++++++++++++++++
Subject: CPQ 4814 w/ZIP $1,699 CPQ announced a slew of price cuts this am. The popular Presario 4814 with ZIP is now only $1,699 Model Old Price New Price Percent Reduction Presario 1610 $2,699 $2,299 11% Presario 1620 $2,999 $2,499 13% Presario 4508 $1,499 $1,199 20% Presario 4528 $1,799 $1,499 17% Presario 4814 $1,999 $1,699 15% <== ZIP EQUIPPED Presario 4824 $2,399 $1,799 25% Presario 4840 $2,699 $2,199 19% Presario 4850 $2,999 $2,499 17% 5+++++++++++++++++++++++++++
Subject: Compaq hoarding the internals? Below is a snip from a post made last night on our website (message #968 in the IOM folder if you want to read the whole thing). I'm pasting it here because of the remark - presumably by Computer City - that Compaq is the culprit in squeezing the supply of internal Zips. Has anyone else heard this from their local Computer City? << I ordered an internal Zip from DellWare, our vendor for many peripherals. Order was placed 10/20. Got a call last week that the Zip would be backordered until 11/6. Got another call Monday stating that the order could not be filled until mid to late November at best. So I called Computer City to inquire about internal Zip availability. He said 'Good Luck!', that there was virtually no way to get them, although they occasionally have the external. He went further by saying the Compaq {of LS-120 fame ;-) } had been squeezing supply because most the their PCs were going to include the internal Zip. >> TMF Jeanie 6+++++++++++++++++++++++++++
Subject: My take on SanDisk, Intel and n.hand << "Story follows, but to sum it up.... 64 megabit for $29.90...prices to drop during the year" Yes, but isn't n.hand supposed to be 25 megaBYTES for $10? Which would make it approximately 3 times the capacity of the Intel chip, for one-third the price? Am I missing something? Thanks. >> I think a lot of people may be missing something here, something potentially significant for the "massive" price/megabyte edge n.hand was supposed to provide for Iomega. SanDisk announced a product at 10MB for $45, or $4.50 a MB. Intel has announced a product for $30 with 8MB, or $3.25 a MB. Both of these prices can be reasonably expected to drop. Now, these are OEM prices and consumers will pay more, but I think we can see Flash moving under $5/MB to end users by late in 1998. That gets it within a 10:1 ratio of the cost/MB of n.hand disks, which Iomega has stated will run 20MB for $10 or $.50 per MB. With Flash prices likely to continue to fall (due to increased production and learning curve effects combined with likely overcapacity in the industry -- I know these seem contradictory, but they aren't), I think we could conclude that end-user Flash prices will decline to somewhere on the order of $1-3/MB by the year 2000. Yes, that range is fuzzy but consider this before you dismiss the threat to n.hand... Many of you disregard SyQuest's new SparQ with a $.03 cost per MB vs. $.10 for Zip (best vs. best) or $.09 for Jaz. There, SyQuest's 70% pricing edge is offset by a number of factors -- compatibility, etc. You similarly discount the stunning $.007 cost per MB of DVD-RAM because of the higher acquisition cost of the drives, performance and so forth. Well, n.hand is going to have its share of problems too: It's not going to be compatible with the wide array of devices that adopt the new Siemens/SanDisk format -- and there will be many. It's going to cost more to add to a camera or PDA than a Flash connector... And even if that first disk for the n-hand is $20 cheaper than the first Flash card, the initial price advantage will remain with the Flash solution. This is the No.1 board argument in favor of Zip over DVD-RAM and SparQ and others. Here it works against Iomega. Now, what of the cost/MB issues? Well, the serious user is probably going to be a re-user of media after transferring the images or data to a PC. They are likely to favor convenience over anything else, assuming quality is equal. The casual user may acquire some additional media over time, but probably won't be put off by additional "rolls" of digital film costing $20-30 rather than $10. Even if Iomega cuts n.hand disks to $5, I don't think they are that close to having a difference maker. Now, add in the fact that n.hand will almost certainly use more power than Flash forever and that upgrading the capacity of the media is actually harder for n.hand than for the Flash, and you've got a problem. (It's harder because once you build a Flash connector in the camera, you can plug in a 10MB module, or a 20MB one, or a 40MB one at any time; with n.hand the 20MB drive is a 20MB drive is a 20MB drive). I will eagerly await the n.hand news from Comdex, because we might yet see remarkable news on power consumption, drive cost, capacity of the disks, cost of the media, etc. etc. If we don't, I wouldn't be surprised to see Iomega release a camera because I'd suspect they'd be making relatively little headway with other OEMs. So, yes, I'm bearish on n.hand in light of the dramatic improvements in Flash's cost/MB, ahead of what I previously believed would occur. With tinier chips than ever (Siemens/SanDisk), power consumption will also drop further for Flash. Already, larger Flash chips (still camera-sized) can hold 20 or 40MB (although these are less generally used), vs. a fixed 20MB for n.hand (so far). Right now, my hazy crystal ball is wondering what Iomega has in store for us regarding this stealthy product. For now, though, the stock price and the earnings per share continue to move on the shoulders of one product: the mighty Zip drive. 12 million Zips by year end. 7+++++++++++++++++++++++++++
Subject: Buckingham Res. ups estimate From Zack's today: << IOM: BUCKINGHAM RES increased estimate for quarter ending 06/98 from $0.26 to $0.28 on 11/05/97 >> 8+++++++++++++++++++++++++++
Subject: n.hand thoughts Coming at this product from conventional data points won't (I think) produce a clear picture of what it is or what its market is going to be. Comparing to flash is only valid to a point, primarily to help think about devices or products that have local storage. But these devices are segregated already due to the costs involved, if a product can be functional with 2Mb of flash that's fine especially if that 2Mb can be cleared and reused like it can be with a camera, what I like to think of is products that don't exist because they wouldn't be usable with less then 20Mb and with those requirements are just too expensive to be viable products. Also products that don't exist because the digital revolution has hardly begun yet. One easy to discuss product is Global Positioning System (GPS) devices, currently GPS gives you a snapshot of where you currently are, useful but crude, the future of GPS is data intensive when you consider the possibilities, near/real time traffic data would be transmitted constantly and plotted as an overlay on a map, which is stored in permanent memory within your GPS device, this map would need to be very detailed to be of any real use, having just a vector map of major routes is a start but a device like that doesn't even compare to one that could have emergency center locations, restaurants (with menus and reviews) business office building and tenant information, residential street address, phone numbers, names, even fire hydrant locations all available at the same time. This can be stored in Flash of course, if you have enough of it, but it's expensive to keep. I live in Philadelphia and surely would want to keep my Philly map in tact all the time especially because over time I'd customize it and store additional information about my home city within the maps database, maybe I've plotted favorite routes, or flagged friends houses and business I work with. Or maybe I've customized the restaurant information with my own comments, who knows. When I travel I'd be inclined to do this type of customization also, my GPS device may become sort of a travels journal, and sure I could upload this data to a zip and download it as needed which would let me reuse one flash card storage device, but in reality I don't think I would. Now if some enterprising GPS map software company set up a vending machine that sold disk based GPS maps for $20 or if I could download a GPS map from the internet and load it easily into my GPS device, either my hand-held one or the one in the dashboard of my car, I'd be really interested. Add a feature that lets me touch the screen with the tip of a regular ink pen and mark a spot and I'd document all kinds of stuff while I traveled, if I could double tap the screen and not only mark it but have a notepad window open so I can jot down some comments then I'm in GPS heaven. The more detail the map has the more I like the idea. The map would need to use overlays for streets, buildings, restaurant locations etc.. and I'd want a few personal overlays as well, but I'd also want to mark-up the default overlays. With satellite photography I also want a JPG or GIF like underlay that basically showed every building and tree etc... If I was a Fuller Brush salesman I couldn't function without such a GPS device and customized maps (at least not after they existed) because they would radically change the way I operated my sales routes, not to mention save me tons of time. I know that this device won't exist in the mass market in 1998 and therefore Iomega's EPS won't increase from GPS maps on n.hand disks, but I am sure this device will exist in the near future, and my time horizon for owning Iomega is measured in years or decades not days or quarters. A system much like what I am describing is being created right now, one of the champions is Rockwell Advanced Automotive in MI, Ford is planning on including it in their 99 model year (high-end) cars, the thing is, they are using a "100Mb" floppy to store the map information and not a 20Mb one. Camera's are here today, as are PDA's and hand-held Games, but all of these devices are infants compared to what they will be and do over the next few years, I'm firmly in the camp that believes that the digital revolution has barely begun and that we haven't seen nothing yet. IMO zip for the big digital stuff and n.hand for the small is definitely in the cards. There are more application for these disks then might be imagined, and as ComptrBob said recently we should see many signs along the way. Digital books, digital recorders/players, digital everything. The flexibility of a cheap magnetic media far outweighs it's drawbacks (spinning media), other types of storage that exist today will have (and have always had) a hard time keeping up on price/performance ratio. The problem with digital storage isn't how big, it's being big enough and usable. 9+++++++++++++++++++++++++++
Subject: Top 10 TOS reasons Top 10 reasons IOM posters get TOSed 10. There are so many of them to choose from, it's hard to help oneself 09. IOM posters are from 2 extremes, both are TOS violations by definition, so posting is optional, you'll probably be TOSed anyway. 08. You have to be ignorant to post here in the first place, so you likely qualify to be TOSed anyway 07. Most here think TOS is a compliment 06. He with the most TOSs at the end of the game wins 05. It's a habit to TOS every post just in case, so the more you post the more TOS's you get 04. A rational, well thought out post posted here somehow MUST be a TOS 03. Some posters TOS themselves immediately after hitting send 02. A common habit of TOSing all posts of 5 lines or less, means all limericks get whammied 01. It's a joint plot by Imation/SyQuest stockholders to remove all IOM posters from AOL permanently I already TOSed myself for posting this _______________________________ End Report. Posts covered through 9:00pm ET 11/6/97. _______________________________
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