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Seagate expands regional reach

Additionally, the company would be announcing the appointment of Flora Limited, Bangladesh, and Debug Computer Peripherals, Sri Lanka, as

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authorised resellers for its full range of disk drives.

Both Flora and Debug are principal resellers of Sujata Infotech, Seagate's oldest channel partner in India.

Seagate's newly appointed partners are expected to expand and strengthen the channel network, extending the availability of Seagate products in India and the subcontinent.

Making a return to profitability in Q4 1997-98 (April-June) after three consecutive loss-making quarters, Seagate has managed to stay relatively unaffected by the Asian crisis.

The turnaround has been attributed to a restructuring and rationalisation exercise after the acquisition of Conner Peripherals (February 1996).

The workforce has been reduced from 110,000 in May 1997 to 87,000 by January 1998. "A major reason for our sustained growth has been our ability to tap growth markets unaffected by the Asian crisis. In this context, India, China and Taiwan have remained very strong, independent of the Asian crisis,'' said Don Kennedy, vice-president, Asia sales and marketing, Seagate Technology International.

According to IDC reports, the PC server market (predominant growth segment for Seagate) grew from 21 per cent in 1996-97 to 234 per cent in 1997-98. The Global PC market, though, fell to 11.8 per cent from 15.2 per cent during the same period.

Despite this, the company is not able to achieve targets for 1997-98. Revenues dropped almost $1.5 billion and unit shipments dropped over 900,000 from the previous year. Kennedy attributes this to the company's moving out of the mobile disk drive market and also the heavy demand for low-cost PCs resulting in a huge drop in the average selling price for entry level computers.

Kennedy is optimistic of Seagate remaining in the black despite a world-wide slowdown in the hardware market.

"We have launched three major initiatives during the last six months. First, increasing operational efficiency to improve time-to-market for desktop products. Second, we have adopted the Six Sigma management system to enable us to compare our business model performance against world-wide leaders like General Electric, Motorola, Allied Signal etc rather than within our own industry. Third, we have implemented a supply chain management initiative to improve delivery of products to customers - what they want, when they want it. These initiatives are well underway and the company is executing against planned targets,'' Kennedy has been quoted as saying.

- Compiled from the Indian media

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