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Tough times for hard-drive companies, report says

Daniel Fleshbourne   on 28 May 2004 - 11:53 · 14 comments & 1913 views

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The disk drive industry is spinning its wheels, according to a new report. The industry, a notoriously difficult one in which to succeed, is stuck in a rut of cutthroat pricing and grim profit prospects, according to the report, released Thursday by investment firm Credit Suisse First Boston. "While demand for hard disk drives remains robust, an extremely competitive pricing environment has emerged, particularly in enterprise drives, which has served to eliminate most of the industry's profit pool for (the) calendar second quarter," the investment firm wrote.

CSFB gave "neutral" ratings to Maxtor and Seagate Technology and an "outperform" rating to Western Digital. "Because of its concentrated product line, which is focused on desktop PC drives, Western Digital is somewhat insulated from the fallout in the enterprise market, making it the most attractive investment candidate in the group," the firm wrote. Neither Maxtor nor Seagate responded immediately to a request for comment.

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News source: news.com


Ballmer also reinforced the ongoing priority of security-related issues and improvements.
"In order to take advantage of new business opportunities and effectively manage upfront and lifetime IT costs, it's important for customers to look at the entire IT life cycle - from application development to operations and management - and to choose a software platform that provides strong tools, ecosystem partnerships, security and support," Ballmer said. "The tools and technologies Microsoft is delivering today help customers work effectively and efficiently in distributed environments and across disciplines to drive growth and respond to change."

Microsoft Tech*Ed is Microsoft's premier technical training event, offering more than 400 sessions delivered by industry experts. More than 11,000 people are attending Tech*Ed 2004 - an increase of more than 22 percent over Tech*Ed 2003.

Visual Studio 2005 Team System Delivers Powerful Life-Cycle Tools
As businesses look to transform their IT organisations from a cost centre to a catalyst for overall growth, IT professionals seek to continually improve the efficiency and predictability of their infrastructure. Managing the life cycle of software development is a critically important component to overall business success and has become increasingly challenging as software teams become more specialised and geographically distributed. This effort is part of Microsoft's Dynamic Systems Initiative (DSI), an industrywide initiative focused on management of the entire application life cycle.

Unveiled today, Visual Studio 2005 Team System delivers productive, integrated and extensible software life-cycle tools that enable businesses to reduce the complexity of delivering service-oriented solutions. The Visual Studio 2005 Team System contains several tightly integrated design, development and testing tools that foster greater collaboration between architects, developers and IT professionals throughout the IT life cycle. Expanding on Microsoft's proven success in delivering highly productive developer tools, the Visual Studio Team System increases the predictability of the software development process, shortens the development life cycle, and enables IT departments to deliver greater business value.

Visual Studio 2005 Team System creates even more opportunities for the Visual Studio
partner ecosystem. Global systems integrators, service providers and tools vendors all play a vital role in complementing and extending the Microsoft Visual Tools family to customers. Today, Borland Software Corp., Compuware Corp., EDS, Telelogic AB and Unisys Corp. announced their support for Visual Studio 2005 Team System.

Partners can take advantage of the integration benefits of the Visual Studio 2005 Team System, giving customers a broad choice of development tool options. "We believe Microsoft's entry into application life-cycle management is evidence that the industry is maturing, and will even further expand for leaders like Borland that have years of experience in the space and a set of mature products already available to customers," said Dale Fuller, CEO of Borland Software. "Borland looks forward to continuing its long-standing collaborative relationship with Microsoft to deliver high-quality solutions for our mutual customers."

Systems integrators can extend the Visual Studio 2005 Team System and Microsoft's process guidance and prescriptive architectures to gain greater predictability in the development process.

"Visual Studio 2005 Team System offers maximum productivity using integrated tools while lowering risk and project-related costs through increased and continuous visibility into the overall project. This allows EDS to increase business agility for clients through configurable guidance, architectural guidance and life-cycle tools built on Windows Server System," said Stan Alexander, vice president of Technology Strategy & Architecture at EDS.

Facilitating Service Orientation With More Secure Web Services
Microsoft's service-orientation strategy focuses on enabling customers to integrate new and existing systems composed of heterogeneous technologies with Web services. To help developers build interoperable, security-enhanced Web services solutions, Microsoft today announced the immediate availability of Web Services Enhancements 2.0 for Microsoft .NET (WSE), a free add-on to Microsoft Visual Studio .NET and the .NET Framework.

Today more than 250,000 developers use WSE to build security-enhanced Web services that help improve business processes within and beyond corporate trust boundaries. Customers such as HP, the Ohio State University Medical Center, EDGAR Online Inc. and Siemens AG are already experiencing the benefits of developing advanced Web services solutions based on WSE 2.0.

The Ohio State University Medical Centre required a solution that allowed authorised users to remotely and more securely monitor, record and replay generated vital-signs data and correlate this data with medications administered in the operating room.

"Microsoft was the only company that offered an implementation of the Web services protocol specifications (WS-Security, WS-Trust, WS-Policy, WS-SecureConversation) required to make the project a success," said professor Furrukh Khan, director of technology for the Collaborative for Applied Software Technology, Electrical and Computer Engineering at The Ohio State University. "By using WSE 2.0, we were able to focus on the solution's business logic instead of writing security code. WS-Policy allowed us to simply install digital certificates and write a few hundred lines of XML that describes how the Web services are to use them. Another big enabler was WS-SecureConversation, which gave us the security that was required without sacrificing performance."

WSE 2.0 enables developers to build advanced Web services using the latest protocol specifications. Developers can use WSE to more easily enhance Web services security by incorporating WS-Security (based on the 2004 Organization for the Advancement of Structured Information Standards (OASIS) standard), including WS-Policy, WS-Security Policy, WS-Trust and WS-SecureConversation.

Additional features include extensible transports, support for custom policies, the ability to host Web services independent from IIS, and asynchronous messaging based on the WS-Addressing specification.

To further support integration of systems using security-enhanced Web services, Microsoft also announced the Technology Preview release of the BizTalk Server Adapter for WSE 2.0. Using this adapter, BizTalk Server customers can easily orchestrate new business processes out of security-enhanced, autonomous Web services, creating further levels of business agility using service-orientation design principles.

Using Web Services to Help Information Workers and Developers Harness the Power of Microsoft Office for IT
The Microsoft Office Editions are some of the most widely used applications in enterprises today, but customers typically have to leave the Microsoft Office experience when they want to access many kinds of business data. Developers now have the opportunity to create intelligent business solutions that address today's demanding business requirements while giving information workers the powerful, familiar user interface of the Microsoft Office Editions. In order to enable software developers to more powerfully leverage existing systems and information even when it is stored in multiple disparate back-end systems, Microsoft today released the technical beta of the Microsoft Office Information Bridge Framework.

The Information Bridge Framework provides developers with a set of tools and components to quickly and cost-effectively build smart client solutions that connect Microsoft Office Professional Edition 2003 to multiple enterprise systems via Web services. Information Bridge reduces the costs of solution development for IT professionals and increases flexibility and manageability of Office-based information integration solutions.

In addition, Information Bridge-based solutions empower information workers to easily find, access and work with line-of-business information within the familiar Microsoft Office environment.

The Information Bridge Framework provides the following:
* A client-side component that interprets XML markup, which describes the Information Bridge-based solution behaviour, including its user interface and user actions

* A server-side component that enables Web services to expose the data, views and actions embodied by line-of-business applications

* Information Bridge Metadata Designer, a plug-in for the Microsoft Visual Studio .NET development system that creates and manages solution metadata

"We're very excited about the possibilities of the Information Bridge Framework. Not only does it make it easier for our developers to build and manage integrated solutions that connect Office to our enterprise, but it also improves the productivity of our employees by building upon the Microsoft Office user interface," said Ken Meidell, chief information officer at Cascade Designs. "We were able to save money and improve our product development process significantly by building upon Information Bridge and Office."


Post a comment · Send to friend Comments · There are 14 additional comments
#1 BOOGSoftball™ on 28 May 2004 - 14:50
Lower prices for us?
#2 CheeseCow on 28 May 2004 - 14:54
Yah, I am sooo looking forward to the 1TB mark.
#3 BOOGSoftball™ on 28 May 2004 - 15:21
hehe..that would be pretty sweet.
(2 replies) #4 aristotle-dude on 28 May 2004 - 16:13
You people are so pathetic. I bet you would not be laughing if you worked for those companies and they downsized your job because of this.

Typical American teenagers.
#4.1 BOOGSoftball™ on 28 May 2004 - 17:39
Typical incorrect assumption.
#4.2 Foub on 28 May 2004 - 20:44
Most likely the job with be shipped overseas anyways even if the profit went up. Corporate America has no loyality.
(1 reply) #5 Glen on 28 May 2004 - 17:09
This does not necessarily mean lower prices for the consumer. If they reduce production, there is a good chance that the prices will begin to increase. Simple supply and demand market.
#5.1 Shining Arcanine on 28 May 2004 - 18:34
QUOTE (#5.0)
If they reduce production, there is a good chance that the prices will begin to increase. Simple supply and demand market.

If they reduce production, several things can happen, some are:

-people will boycott them

-other companies will increase production

-no one will be interested in their products

There are loads of hard drive companies in the US, Western Digital being the one that I always buy from.
(1 reply) #6 hotrod on 28 May 2004 - 23:56
too bad we don't have this problem amongest the oil companies about now..
#6.1 Botiemaster on 29 May 2004 - 00:19
i hear that, problem is all them greedy oil punks have decided to team up and keep product low in supply for increased profits. Better watch out it could backfire. Be a shame if everyone in the world decided to buy electric cars
(2 replies) #7 naap51stang on 30 May 2004 - 15:33
Greedy oil punks?
How about stupid enviromentalist? That would be a better term.....
Not ONE new oil cracking facility has been built in the USA in decades.
Why? Enviromental restrictions. We have vast reserves of oil located
off the coast of California, Gulf coast, Alaska, but we don't drill for oil.
Why? Enviromental restrictions. It doesn't matter how much oil the
OPEC countries produce. We haven't any way of converting it to gasoline!
And, there are 3,432,456 different blends of gasoline "required" by clean
air acts in different states for summer & winter. So, if there is an excess
of type A gasoline in lets say New York, they can't ship their excess to
California because they require by law type B gasoline.
Electric cars, in their current (no pun intended) flavor are not an answer.
Where does the electricity come from to charge their batteries? Most likely
a coal fired power plant! The USA had a chance to have an almost unexhaustable
source of cheap electicity from nuclear, but TMI and chernobyl, along with that
stupid china syndrome movie killed that idea. Yes there are concerns about
storing spent fuel rods, but that has now been addressed.
Batteries for electricially powered cars are another thing. In 4 or 5 years, you have
to replace those heavy LEAD acid batteries. Enviromentalist would have a cow if
you just dumped them into a landfill.
Personally, I think that eventually the hydrogen powered fuel cell idea will be the
best alternative source of power, but what I think the automobile industry should
try to do is get the internal combustion engine to run a little more efficient. I think
it's only about 15-20% efficient.

#7.1 puredeath on 30 May 2004 - 17:02
see below.
#7.2 puredeath on 30 May 2004 - 17:03
At our current rate of gasoline consumption, we'll go through our "reserves" in less than 7 years, experts believe. We do have oil in California and Alaska, that is true, but they estimate reserves to be marginal and not worth spending billions of dollars to be extracted and sold to the public. Some estimate that we won't be able to break even within 5 years. Suppose they decide to go ahead with the drilling, build oil refineries, and spend billions of dollars on delivering domestic gasoline to American citizen. How much do you think domestic gasoline will cost? Saudis won’t react favorably upon this. They’ll either cut gasoline exports to US, or better, yet, and a most likely outcome: they'll start slashing prices aggressively. Now, typical American won't overpay for gasoline, which is a fact. Which do you think Americans will purchase: the more expensive, domestic brand, or the less expensive, imported brand? Just like with recycled paper, which costs couple of cents more, people usually buy what's cheaper -- typical capitalism. Though, republicans have you believe otherwise, that we have an infinite supply of oil, and they blame everyone for “preserving environment”. Well, they also believed Iraq had WMDs, so…

You are correct though, nuclear and fusion power is the future.
#8 puredeath on 30 May 2004 - 17:09
"Outperform" rating to Western Digital.

I can see why Maxtor and Seagate lag behind. Believe it or not, I never had a WD drive fail on me. I am still running a 500MB, 1995 WD drive in my “firewall” machine. And I have 2 raptors in raid in my new machine. WD is the defacto standard for all HD's, and I'll never buy another Maxtor or Seagate, simply because all others failed me. When it comes to quality and reliability, WD is it.

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