Mr. Heid: Iomega Corporation is dedicated to providing storage solutions for the effective protection and security of our customers' valuable digital information. Our main customer focus is the home consumer, home offices, as well as small and medium- sized businesses. Essentially we are providing a range of products, all the way from a 64MB Mini USB drive up to a 720 gigabyte network attached storage device. The company was founded over 20 years ago and went public in 1983. It had its first well- known success with the introduction of the Zip drive and the Zip disks. As a result of this, the company has established what I would call four major assets. One is its strong Iomega brand name on a worldwide basis; two is worldwide channel coverage; three is world class core competence when it comes to magnetic removable storage; and last but not least, partially based on the efforts of the management team in the last 18 months, we have a cash position of $454 million while our debt, both long-term and short-term, is less than $3 million. As a management team, we are very, very committed to utilizing and maximizing the return on all of those assets for our shareholders.
TWST: Could you give us a sense of the competitive landscape and
the advantages you enjoy within it?
Mr. Heid: The competitive landscape in our area very much depends
on what different product segments and what recent product
solutions you're looking at. If you're looking at what I would
call mobile and desktop solutions where we sell products like,
for example, our Zip product line or external hard drives or our
external CD-RW drives, the competition varies. For Zip itself we
don't have direct competitors for high-capacity removable
magnetic storage. What is causing Zip to decline is not direct
competition but substitution with new technologies as well as
different ways in which the customers are actually solving their
data storage problems today. If you look at the external CD-RW
market and the external hard drive market, you will find well
known high-tech brands as our competitors, as well as companies
like Maxtor or Western Digital in the area of external hard
drives. If you look at network attached storage, which is really
the network data near-line back-up device for small and medium-
sized businesses, the major competition there is Dell Computer on
one hand. Another competitor was Quantum, which had a network
attached storage business that was successful before it and was
spun-off in the last six months as Snap Appliance, Inc., which
continues to be a competitor to us in this space as well.
Tickers included in this excerpt: IOM
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