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Tuesday, March 03, 1998 Monday, Iomega closed at $9 3/16, up $1/16 (+0.68%). TODAY'S RECAP: Dell announced the inclusion of Zips in its Omniplex line of corporate computers, while Micron announced that one series of Zipped computers would now be Zip-optional. Needless to say, Iomega's encroachment into the business lines of computer makers took center stage as the topic of conversation for most message board posters. Other issues up for debate included IOM in the N.Y. Times, P/E importance and another comparison of Zip and competitors. 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 Jeanie comments on the Dell w/ Zip announcement.
Recap written and posts compiled by TMF Weekly. _______________________________ And now, the Best of the Board...Started 9:00pm ET 3/1/98. 1+++++++++++++++++++++++++++
Subject: Dell Offers Zip Built-In Don't know about you, but I get a big smile just seeing these two names together :) Now, if only a few crumbs of that magic fairy dust surrounding Dell's stock could just fall in the path of IOM on this news... << Dell is offering Zip Built-In to meet corporate demand for fast and easy data access, mobility between the home and office, and increased capacity to store even the largest multimedia presentations. >> 2+++++++++++++++++++++++++++
Subject: Re: Dell Offers Zip Built-In For anyone out there who might know better than me, I notice the language between this release and the one a week ago with IBM Japan. In the IBM version, it clearly states that the Zip will be a "standard" feature. In this Dell release, it states that the Zip will "offered" in the new line. Does this imply "option" feature. If so, Iomega would seem to be following Syquest's que of putting out non-event press releases (i.e. good pub for today's stock price but not substantive news). I'm not saying this is not good news - any time Dell and Iomega can be put in the same sentence (which is nearly impossible unless one is contrasting 1998 stock price performances) is good for Iomega. However, if it was a standard, I'm sure the pub writers at Roy would have put Standard in bold 14 font. So this is appears to be much ado about nothing. We need the Zip to be the STANDARD feature in Dell boxes. Heck, every ma and pa shop offers the zip as an option. It's like buying a car, how many people get all the options when they buy a car. Before anybody out there shouts I do, just remember that 80+% of cars are nothing more than the standards with few extras and that's because mass America doesn't value the options enough to buy them. I think one can draw similar parallels with the computer industry. I haven't added much to my computer of 3 years ago execept 16RAM of memory and that was only because it was given to me. Everyone on this board obviously might be more advanced the norm when it comes to operating a computer but for Iomega to be successful the Zip needs to be in the Box. In retrospect, I think I would've spent 50 of the 100 million in advertising by enticing Dell, Compaq, Packard Bell, Gateway, etc. to include the Zip as the Standard. All IMHO. 3+++++++++++++++++++++++++++
Subject: Re: Dell Offers Zip Built-In Sure it would be nice if Dell stuck a Zip in every computer as a standard option. Maybe some day they will. Before then I would suspect it would be an optional feature. You can look at it as a half-empty/half-full type of thing. The fact that Dell (and Micron) can offer stuff as an option is one of the keys to their success with the build to order business model. Don't dismiss the word optional from companies like Dell and Micron. Dell making the Zip an option in the Optiplex line shoots down an entire Bear theory. Dell would not include Zip as an option unless they thought it would be worth the effort. The significance of today's news to me is that Dell sees a demand for Zip drives in a corporate networked environment. Many bears have argued that nobody with a LAN needs a Zip. Well, Dell is now building Zips into PCs (the Optiplex line) that are designed for the corporate networked environment exclusively. Dell sees a demand for Zip drives in the very environment Bear's have sworn was the last place you would need one. The LAN does not extend outside the corporate campus for the most part. With more people taking work home and taking it on the road, corporate buyers are seeing the utility in cheap large capacity ubiquitous removable storage (i.e. Zip). A worker with a Zip at home, a Zip at the office, and a Zip in his/her laptop (and don't forget a Zip at the local Kinkos, Zip at her boyfriends house, etc) is much more data mobile and thus more productive. 4+++++++++++++++++++++++++++
Subject: Re: IOM value based on ZERO growth?
From: MarkRogo: Though the current market P/E might be that high, I don't think it's reasonable to use such a high multiple for the purpose of "Zero Growth" valuation. That is why is suggest finding out what P/E multiple "zero growth" companies currently enjoy, as well has what they have had historically. The utility sector was considered "zero growth" for a long time, but with deregulation on the horizon, themutlitple will not reflect that. (Deregulation implies a growth potential) As to the sustainability of these multiples... well, that has been the bone of contention between bears and bulls for several years now. FWIW, besides a flat yield curve, other theories of the historically high P/Es include: - Market Demographics: Baby Boomers are piling their money into Mutual funds. This is expected to continue for the next 10 or so years. With more buyers than sellers, prices go up. - A higher Market Risk Premium: This is a little tricky to explain... Since investors expect a higher return, more of them are buyers regardless of the current P/Es. (The MRP is what you multiply a stocks Beta by when using the CAPM to value it. The higher the MRP, the higher the expected return of a stock with a Beta of 1 will be.) 5+++++++++++++++++++++++++++
Subject: Micron Drops Zip from MILLENNIA.XKU-BUSINESS as Std. Micron Drops Zip from MILLENNIA.XKU-BUSINESS as Std. Micron recently changed its standard configuration for their Millennia.XKU Business system. It had included Zip as a standard item. Now it must be selected as an option. Here's the address for everyones reference.
http://www.micronpc.com/store/nocookies/ The Millennia.XKU Home system still includes Zip as a standard item. Here's the address for reference.
http://www.micronpc.com/store/nocookies/ I personally like to buy standard configurations from Micron because they ship very quickly. Just as an example I ordered a std. configuration on Friday, Feb. 20 and received the computer on Wensday, Feb.25. Not bad. If you changed the configuration it can add weeks to the delivery time. I don't think this is bullish or bearish for IOM. I think it's a non-event much the same as IBM and Dell announcement. These announcements mean very little to the valuation of IOM. If they had an effect it should be reflected in the stock price. It's nice PR but it adds nothing of value to IOM's current valuation. An announcement that quantifies the inclusion of Zip drives would be of significance. 6+++++++++++++++++++++++++++
Subject: review in homePC magazine http://techweb.cmp.com/hpc/mar98/45REM06.HTM Here is a link to a review/testing of five different storage devices found in the march 98 issue of homepc (www.homepc.com). The drives tested are the
Iomega Zipplus << Room mates: The best removable-storage drives If your hard-drive space is tight, or you need to transport or back up lots of files, a removable-storage drive can be a lifesaver--one disk can hold as much as 2 GB of data. Turn here for the scoop on compatibility and other issues, and to see our choices for the best low- and high-capacity drives. By Jim Cope >> It is an objective review looking at price points, speed, size and compatibility pros and cons of each drive etc. (does anyone know the circulation for home PC??) The ZipPlus got a 4 star rating, the Sparq was praised for low price (3 1/2 stars) and the LS 120 got little praise (2 1/2 stars)... check it out.. 7+++++++++++++++++++++++++++
Subject: COMMENTS ON IOM ADS The "New York Times" now has a new section which will come out every Thursday. It is called "Circuits" and is to be devoted to the idea of explaining computers. The first issue had a full-page ad by IOM. It shows a woman holding five carts up like a fan. The headline is "COOL MULTIMEDIA HANDOUTS". The text of the ad pushes the idea of giving out a copy of a multimedia presentation on an IOM cart, ..."when the applause dies down, you can either pass out disappointing stacks of paper, or surprise them with copies of the real thing." This could sell some carts if any companies follow that suggestion. On another page J & R Computer World has an ad which is 4 inches wide and which runs from the top to the bottom of the page. The top half of the ad has the Zip with the heading "LOWEST PRICE EVER", $89.99 (external, not refurbished, including 1cart) if purchased at the same time with a 10-pack @ 129.99. So for $219.98 one can get 10% more storage than the SpaQ at only an additional $20.98. Bottom half of ad is for 1 GB Jaz, including one cart, for $199.99. I believe this exactly matches the SparQ price. Unfortunately, adjacent to the big ad is an article about an outfit, Drive Savers, who may be able to salvage data off of a drive which crashes. The article begins with a woman who "stuck a paper clip into her Iomega Zip drive and jiggled it until the 100 MG disk popped out." There is not addition mention of IOM in the article. The lead-in for the article could just as easily have been a story of a Seagate Hard Drive failing, but it was not pleasant to see the name Iomega Zip attached to a problem. _______________________________ End Report. Posts covered through 9:00pm ET 3/2/98. _______________________________
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