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History 2002: Iomega in Flash Keys

Decision logical for company that specializes in removable storage devices

Iomega has decided to add a flash key, which it will call the Mini USB drive, initially at 64MB ($70) and 128MB ($100).

This decision seems entirely logical for a company that specializes in removable storage devices.

There is the question, however, of whether there remains any actual profit to be made in the new business, coming just as competition in the sector is becoming especially fierce, for devices whose margins are consequently extremely low, particularly since they are made by subcontractor M-Systems on the basis of DiskOnKey technology.

Recall that Iomega decided 3 years ago to get into the CD-R/RW market, also at a time when the market was already saturated with operators, and again shopping them out to a subcontractor. As expected, the activity has remained in the red, in spite of firm’s assumption that its famous brand name would make it a major player in the field.

This article is an abstract of news published on issue 179 on December 2002 from the former paper version of Computer Data Storage Newsletter.