John Drollinger, director of large format optical products at Plasmon, wrote to us: “As you may know, I have been a subscriber to your newsletter for several years now and consider it to be the best publication of its kind in the storage industry; however, in your December 2000 issue, I want to correct a statement that you made about the future of 12-inch optical technology.
“In a half page article on page 8, you reviewed the transition from 5.2GB to 9.1GB in the 5.25-inch MO technology, beginning with the following sentence: “There is still a lucrative, if narrow, market for 5.25-inch optical disks, particularly since the 12-inch optical disks are nearing the end of their lifespan.“
“Nothing could be further from the truth with respect to the 12-inch technology. While other large format players have exited this market because they could not make the technology work or because they deemed it too small overall to justify further development, Plasmon is highly focused on this niche as detailed below.
“1. As you know, Plasmon acquired the Philips LMS division in January, 1999 (where the 12-inch drives are developed and manufactured) and in July 1999, we acquired the Cygnet 12-inch library business. The development and production of the libraries was moved to our Eden Prairie, MN, location at the end of 1999.
“2. These acquisitions were very significant for the future of this large format optical technology. The LMS division was not part of Philips’ core businesses (lighting, semiconductor components, and consumer electronics) and represented less than 1 % of total revenues. As a result, the product line never received the attention it deserved (primarily investments in R&D, key personnel, and marketing). As part of Plasmon, whose core business is optical storage, the large format optical products represent over 35% of total revenues and are a key piece of Plasmon’s overall business.
“3. Plasmon announced a new roadmap for its 12-inch technology in October of 2000. The roadmap consists of a doubling of disk capacity to 60GB at the end of 2002 and a subsequent doubling to 120GB and then 240GB per platter by mid-2006. Key factors in this roadmap include development cycles of only about 2 years or less between fut, gens and backward compatibility to at least 2 previous gens. This development schedule is very realistic given Plasmon’s commitment to and investment in this technology and the fact that we are not bringing any radical new technologies to bear on these gens.
“In fact, we have been reading and writing to 60GB platters since February of this year. In its last fiscal year which ended March 31, 2001, Plasmon shipped over 1,000 30GB drives and nearly 40,000 pieces of 12-inch media (all 4 gens).
“While these numbers may below in comparison to DVD or MO technologies, they still represent a very healthy business for Plasmon. Our optical media business in Melbourn, UK had another good year as sales of 12-inch media grew by some 3%. Sales of the new 30GB media increased rapidly during the year and now represent some 23% of total revenues. The majority of 12-inch media sales are the last gen 12GB units but we still derive some 19% of revenues from the earliest 2GB and 5.6GB disks, the drives for which stopped shipping in 1990 and 1995 respectively. The 12-inch media business therefore represents a stable and highly profitable part of Plasmon with a good long-term earnings stream.”
This article is an abstract of news published on issue 162 on July 2001 from the former paper version of Computer Data Storage Newsletter.