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Wednesday, November 19, 1997 Tuesday, Iomega closed at $31, up $1/16 (+0.20%). TODAY'S RECAP: The looming competition between flash memory cards and Iomega's new clik! disk continued to dominate the board yesterday, although other topics were raised as well: NEC Zipped SKUs, advertisements, Merisel's Hot List and more. A post to lighten the mood was reposted by ~TMF Cheeze~ -- be sure to check it out. 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++ BHM ALA shares news on the PC Magazine award-winning NEC SKU with
Zip.
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 11/17/97. 1+++++++++++++++++++++++++++
Subject: ZIP UP ANOTHER ONE NEC Computer Systems Division Wins PC Magazine Editor's Choice Award With Direction Desktop Personal Computers Each NEC Direction PC is built to order and comes with (or is available as an option) a number of advanced features. These include: up to 192 MB SDRAM; up to 8.4 GB Ultra DMA or 9 GB SCSI hard drives; 24X CD ROM drives; 15" or 17" NEC monitors (13.8" and 16.0" viewable image size); Number Nine video cards with up to 8MB RAM; Altec Lansing speakers and subwoofers; US Robotics 56Kbps modem; and an Iomega Zip drive. 2+++++++++++++++++++++++++++
Subject: 10 million Zips milestone ad Forgive me if this has already been mentioned, but in Monday's USA Today there is an Iomega ad/announcement/thank-you-note in a special technology section. The ad/thank-you-note commemorates the 10 millionth Zip shipped and thanks "the customers, employees, suppliers, channel partners, shareholders and other friends for helping us provide the world with the capacity to do more." The headline for the announcement/ad reads "With 10 million Zip drives shipped, we're happy to say we're the standard. Or simply Whoooooooo..." And the full-page ad here shows a photo of guy blowing on one those party-favors that shoots out a paper tongue, with the tongue flying out towards the viewer in a weird 3D, wide-angle effect. There's more text, but you get the general idea. The USA today also has a full-page ad from Circuit City for three Zip-inside computers-the Compaq 4814, the Apple Macintosh 6500 and the Sony PVC 200. 3+++++++++++++++++++++++++++
Subject: $300 Flash Memory??? << ..oops dear, I think I just dropped the 300 dollar flash chip in the toilet!!!.. >> Huibs, Your not the only one to refer to this price point (which I assume means you think its valid or representative) for flash memory. I must have read at least 7-8 posts citing the same number in the last few days. While this would certainly make the relative economics of Clik! extremely appealing (again putting aside the non-cost advantages of flash memory vs mechanical devices), the fact is that this $300 number has nothing to do with the current prices of flash memory, and even less to do with where it is likely to be priced by the middle of next year. For those who think the $300 number has any credence, here are some current prices from the latest CompUSA brochure (BTW these do not appear to be "special" or "sale" prices). For use with Olympus D-220L Camera -- additional 8MB module -- $99.99 For use with Olympus D-320L Camera -- additional 15MB module -- $199.95
These prices are not reflective of the latest design improvements, which
promise to further substantially reduce flash memory prices. For those
interested, there is an article (which may have been mentioned in a post
here a number of days back) in the Electronic Buyer's News dated 11/3/97
that discusses these improvements from Sandisk and Intel in detail. The URL
is http://www.techweb.com/se/ The article indicates that the enhanced design will allow Sandisk to begin offering 80-Mbit (10MB) chipsets (chip and controller) at $45 each in volume for use in consumer applications such as digital cameras and PDAs. The article also states that the new design will allow Sandisk to triple the capacity of it's CompactFlash memory cards up to 60MB by next year. 4+++++++++++++++++++++++++++
Subject: Merisel's "Hot List" Comdex Awards Among the winners: Commercial Category - Storage: Zip Drive 100MB Parallel Port Solution-Iomega VAR Category - Storage: Zip Drive 100MB Parallel Port Solution-Iomega Macintosh Category - Accessories: 100MB Zip Disk-Iomega <<Merisel's Hot List is produced to recognize the best-selling products within 25 product segments and four distinct channels: Retail, VAR, Macintosh and Commercial. Since 1982, Merisel's Hot List has been a leading industry indicator in determining top-selling products and has provided resellers, manufacturers and industry analysts with a comprehensive tool to track product trends. >> 5+++++++++++++++++++++++++++
Subject: Re: $300 Flash Memory??? << Go ahead, lower flash prices by 50%. Guess what, still twice as expensive as Clik! >> Flash is available. Clik is not. Flash is tested and proven. Clik is not. Clik is a floppy media, which means it will be spinning about while being handled and absued in the hands of the general public. It must withstand a certain amount of punishment, which is not yet proven. We may well find that folks are willing to pay a premium for flash if Clik has problems. In other words, while Clik is a promising prospect (think minor leagues for the moment...continuing the baseball analogy), flash is up in the majors and playing. Flash is not a superstar by any means, but they are in the game. Clik is not. Clik not only wants to get to the majors, but wants to displace the current player at its position. Not easy. I wouldn't be too quick to be so dismissive of flash...especially if Intel is involved. 6+++++++++++++++++++++++++++
Subject: True Iomega Zeal From ~JJinLA~ on our fool.com Iomega board: << I went down to Frye's to check out the IOM. I was enraged to see that they were selling Avatar and LS-120's ON THE SAME AISLE!!!! Pulling my Glock (we Angelenos are all packing) I confronted the sales person, 'get these g*d**n inferior drives off of the shelves next to my beloved Zips!!!!' I called over the manager, and a couple minutes of smacking him with a new 56k modem taught him some IOM religion. As the sirens drew nearer,I left the parking lot with a screech of rubber, emptying the Glock into the storefront as I left. It will be a while before they reorder Syquest, I dare say!!! Now for CompUSA. Ditching my stolen car, cuz it was now too hot, I entered through the employees door with the tire iron. Found the Syquests, Imations, etc. in the back. Five minutes later, those puppies were unsaleble!!! Now for the manager. I asked him which portable storage device was selling the best. He hesitated a minute, then said 'jaz? maybe zip. I. . .I. . . think that Syquest has been selling okay' --'What!!! don't you know those inferior drives can't hold a candle to Iomega's fine product line!!' I barked. The manager fainted. Don't think he's gonna order Syquest, either. Well, that's all for now. I still have to rough up a couple more sales people later this week. Fool on!!! >> 7+++++++++++++++++++++++++++
Subject: Flash -My Brain Mush << "They are not standing pat," Niebel said of SanDisk's ambitious product rollouts and its somewhat intriguing departure from the classic 8-bit word-length progression to a base-10 formula with the 80-Mbit chip. The change is unlikely to result in compatibility issues since flash-card interfaces tend to be proprietary anyway, he said. >> I need to bone up on Flash technology in general, but does this mean that I am stuck buying additional Flash cards from the vendor who supplied the interface that's inside the camera? If so I didn't know, at least not with consumer products. A few things I remember about Flash and why it's hard to make and expensive: Flash is non-volitile RAM which means that it "remembers" or retains its state (1 or 0) without power constantly being applied, this requires a (wrong words coming but the concept is there) very pure silicon wafer and it is hard to get good yields (meaning lots of scrap is generated). With DRAM (regular PC RAM) the silicon isn't nearly as important because the state (a 1 or 0) is constantly refreshed so it doesn't fade, there really aren't 1's and 0's stored in RAM of course 1's and 0's are just a way to think about it, you could use high and low just as well, or on and off, volts no volts, etc... In DRAM (or SRAM or SVRAM or whatever) each bit is either hi or low ( - hi _ lo) power is constantly applied to maintain the state and every few micro seconds the state is checked and rewritten because otherwise the bits tend to drift (causing errors) it's a good system and allows for flaws in the silicon to be tolerated with little risk of memory errors occuring. Currently DRAM is about $5 per MB (Retail) which is very cheap compared to a few years ago but still no where near .25 cents. In Flash RAM the bit needs to remain set even without power being applied, so you need a special (call it high grade silicon) which is extremely tough to make, Flash RAM is getting chearer but it's relative only to Flash RAM. SanDisk is doing wonders in driving the costs down and I'm way out of date regarding silicon yields etc.... but at $45 per 10MB (their forcast, not reality yet, and not a retail price) it's still got a long way to go. One thing SanDisk does is "stack" the bits somehow which, while I don't know exactly what that means, nearly doubles the capacity of the silicon (technology marches on) But the need for very reliable (stable) silicon to begin with still remains. This is why regular DRAM plants can't make Flash RAM, Flash is a totally different animal. SanDisk's new technique also makes for a slow writing process (100 Kbytes/second) That's 10 seconds per MB! (or is my brain just mush?) When DRAM is .25 cents per MB then we should begin to worry about Flash prices getting near a point where they might compete with magnetic alternatives. One side comment on a spinning disk in a handheld device, It's a non-issue from an operating point of view because all that a user may notice is a brief whirring sound lasting a second or so, much like an auto-advance film camera only lasting a tad longer. Actually it may be an advantage having the whirring, it will act as a signal to let you know it's done, giving users that warm fuzzy feeling of being "filmlike" From the article: What does this $1 per MB target have to do with hard drives? If it's a goal for Flash pricing then it's lofty but still leaves clik! with a 4:1 advantage 3 years out! (using clik's current cost per MB estimates) I don't see any validity to comparing current magnetic costs with future Flash costs though. Apples to Apples and all. << Meanwhile, SanDisk and others will have to scurry to beat manufacturers of hard drives to the $1-per-Mbyte target before 2000 to ensure flash's position as a mainstream mass-storage contender for high-volume applications. >> Please feel free to update my aging knowledge (circa 1995 I believe) and / or correct me where my brain bits drifted creating errors in memory. I don't have a magnetic memory and a Flash one would just cost too much! :) 8+++++++++++++++++++++++++++
Subject: Re: SmartMedia(TM) is Removable Storage Solution of Choice << You missed the point, I didn't state it clearly, or its not valid? Ever transfer 40mb through a serial connection?! >> joeyroman, You have, I believe, hit a huge nail on the head. I have maintained -- and Huib's piece on the Mavica also highlighted this in a way -- that the best solution from the consumer's point of view is a permanent PC-attached drive and an OEM drive in the portable units (whether cameras, PDAs, etc.). I don't think I've ever outlined the reasons very well, so here's a shot, starting with your point: 1) time of transfer through serial -- as well as complexity 2) availability of ports -- how many serial devices do we all have already 3) consumer preference -- aka Mavica disk preference -- and ease of use. nothing is simplier than ejecting the disk from the camera and inserting it into the desktop-bound drive. Consumers are used to them, it is simple and, as you note, fast. This has been, however, a major barrier (IMO) to flash as the desktop "cages" haven't sold too well. Partly because those companies aren't used to or don't excel in aftermarket retail sales (concentration on OEM), an arena Iomega clearly understands. This also highlights my disappointment for the Zip-caddy idea that was once floated. That said, the "need" (not literally, but in my mind as I consider it a barrier to success) for a desktop Clik! drive as well as OEM Cliks built-in to the various units will work both for and against Iomega. AGAINST: It raises the cost of ownership in the short-run. $200 for the desktop unit plus, say, $75 for the OEM unit (cost distributed to consumer) raises the stakes in terms of acceptance. However, Iomega can, perhaps, leverage both retail strength and know-how as well as Zip installed base to alleviate this barrier somewhat (I had the dream of the 12.7mm Zip and a Clik! drive in a single PC bay). FOR: Once a consumer has made the investment in the desktop Clik! drive, they will be pre-disposed to purchase Clik! enabled devices in the future, effectively lowering the additional cost of that desktop-bound unit in the process as they spread it over (for example) a PDA, a phone, and a camera. This works to both Iomega's benefit (in terms of extra Clik! drives sold to OEMs as well as disks) and the manufacturers of Clik! devices as it will drive sales of other Clik!-enabled devices for them going forward. It also operates as a significant barrier to entry once a large-enough based is installed. While I understand that a desktop-bound Clik! unit isn't neccessary, I do believe it will be the set-up of choice going forward for all of the reasons outlined above. Of course, as I said, an external and portable Clik! (which can be made into a permanent desktop-bound unit in the future) is an excellent starting point in some ways for Iomega because it allows them to capture the early-adopters and grow the "installed base" of what I would call portable Clik! drives destined to be desktop-bound in the future. As others have noted, Clik! has a certain amount of potential, but that is all. It is far from being a proven concept and even the best products, due to the ever-finicky consumer -- can end in disaster. I am NOT portending disaster for Clik!, only mentioning that the risk of a product that won't be introduced FOR ONE YEAR YET, is immense. That is what makes a market. No reward without risk. The risk-free rate is there for all who want it (T-Bills) and then there is the stock market for those willing to take a little more risk for the POSSIBILITY for a little more reward, and then, at the extreme, is probably the start-up/venture capital market where risks run very high but so too can the returns. Evaluating the risk -- though we must first even ackwowledge its existance -- is an important part of understanding Iomega's future. Clik! prospects look promising, but the road will definately be rocky and I'm sure there will be a snag or three no one here (or at Iomega) has yet anticipated. Always seems to be that way. That is why you can't just go throwing $.55 into 1999's earnings right away. _______________________________ End Report. Posts covered through 9:00pm ET 11/18/97. _______________________________
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