Seagate's exit from laptop business no big shakes, analyst says

Seagate's exit from laptop business no big shakes, analyst says

Seagate Technology is quietly ceasing its production of hard drives for notebook computers. But at least one analyst said the small market share enjoyed by the world's largest maker of desktop disk drives means its presence will hardly be missed.

Seagate is still shipping a limited number of 2.5in disk drives to OEMs in Taiwan, but will suspend production altogether in the very near future, said Phil Detwiler, Seagate's senior vice president of marketing.

Detwiler cited price competition and the cutting-edge technology required in the manufacture of hard drives for notebooks as reasons for Seagate's decision.

Detwiler said: "Rather than suffer with low market share, we'll probably withdraw."

Seagate will continue its research and development of laptop storage technologies, but it will be "easily a year" before Seagate re-enters the market, Detwiler said.

Seagate's decision comes on the heels of similar announcements from Western Digital and JTS, which have also said they will pull out of the mobile business. Such departures from the market leave IBM and Toshiba as the main manufacturers of mobile hard drives.

While the company is the largest provider of disk drives for desktop computers, Seagate only supplied about 7 per cent of the 14.5 million hard drives for laptop computers shipped in 1997, representing less than 5 per cent of the company's revenues, Seagate's Detwiler said.

Seagate posted a net loss of $US183 million on revenues of $US1.67 billion for its latest quarter, ending January 2, 1998.

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