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Intel Revenue Dives $1bn On Hard Disk Shortage
nk497 writes "The hard disk shortage caused by the flooding in Thailand will cost Intel $1 billion in lost revenue, the company said. It had initially predicted revenue of $14.7bn this quarter, but that will now be $13.7bn, it said. 'Sales of personal computers are expected to be up sequentially in the fourth quarter,' Intel said. 'However, the worldwide PC supply chain is reducing inventories and microprocessor purchases as a result of hard disk drive supply shortages.'"
The perfect time for Intel to push SSDs?
Wrong. In American capitalism, if your company isn't constantly growing or constantly making a bigger profit, then it's "dying". Then your stock will be downgraded by ratings agencies and stockholders will sell it off.
It isn't true for privately-held companies, but for publicly-traded companies it is.
In a capitalist system, that's not theft. If the price is agreed to by all involved parties then it's fair.
A company may boost it's profits for any number of reasons, not all of which are driven by pure greed - bankrolling some money for future growth being the obvious one. Or would you prefer that companies grow by borrowing, which involves usury (which, by your too-much-profit principle, may be a more pernicious form of theft)?
Profit is inherent in the concept of trade. Two people agree to an exchange because both value what they receive more than what they had. In a very real way, a fair trade involves both parties profiting. In different ways, true, but profit nevertheless. This drives trade, and has for thousands of years. For producers, they generally receive the profit as money. Intel is a producer.
If this fact did not hold, trade would not create profit, there would be no incentive to trade or produce, and the entire system of production would collapse. Incidentally, this is also why Marxist Communism doesn't work... or one reason, anyways.
"None can love freedom heartily, but good men; the rest love not freedom, but license." --John Milton
The loss seems all big and impressive and such until you actually bother to look at both numbers and realize that it really isn't so bad after all. What this really goes to show just how BIG the PC business is and how a relatively small setback can be portrayed as this dire tragedy.
A Pirate and a Puritan look the same on a balance sheet.
I tried to order a Seagate Barracuda SATA 6GB 3TB Drive and Newegg and they wanted $400. I ended up buying two Seagate Expansion USB 2.0 3TB Drives for $199 each and I removed the Seagate Barracuda SATA 6GB 3TB Drives from the enclosures and saved $400 on my total order.
Sig Follows: "Suppose you were an idiot. And suppose you were a member of Congress. But I repeat myself." -- Mark Twain
Intel does not sell computers. They sell processors to people who sell computers. Those people can't built computers without hard drives, so they are buying fewer processors. Not that hard to figure out.
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The problem with a company that isn't growing is that it isn't making any progress expanding into new areas and finding new customers. Which means it's just waiting for the next generation of tech or (for non-IT companies) the first disaster/neighborhood change/etc to kill the business. In other words, it's just waiting in limbo for bankruptcy. Fact is markets change.. what you sell today is tomorrows commodity, or worse, an obsolete good. Companies and business models have to change. Anyone who doesn't will eventually die.
IMHO: I'm surprised that SSD manufacturers are not taking advantage of the HDD shortage and giving deals left and right. Intel could profit greatly right now lowering their SSD prices just slightly. PC manufacturers will benefit by selling computers and the end user will get that "speedy" system for only a slight increase in price. The higher price will definitely pay for itself considering the boot and operating speed of a SSD over HDD. Granted that's with the consideration you didn't buy a system with 1GB of memory and a Celeron proc running Win7.
Obviously anyone looking for large capacity drives is still SOL. I know some local stores in the area are still selling drives for reasonable prices until they run out. I doubt they'll bother to stock some or any at all after that. I'm sure they don't want to be left holding $2-300 drives that will be selling for at least half that a couple months from now.
On another note, who had the bright idea of creating a single point of failure? I wonder if WD, Seagate, etc setup their networks all with single points of failure. I understand it's cheaper but if you can't make drives, you're not making money.
Good thing we can't make hard drives any where else in the world! I love globalization. I don't know anyone in the states that could be trusted to work at a plant making hard drives. They'd expect to be able to pay for food, shelter, and clothing, and we can't have that!
Or, and potentially just as bad for Intel, they're using a lower-speced and likely lower margin CPU to make up some of the cost difference due to the HDD.
Oh please, what an utterly stupid attitude. Not all companies are tech companies. If the makers of Twinkies find their company isn't growing, what exactly is the problem as long as they're profitable and their workers are well-paid (and presumably their executives too)? There's only so many Twinkies you can sell; people aren't going to abandon all other foods and only eat Twinkies (and even if they did, eventually your company's growth would then be tied to the population growth rate). You don't need to move into new areas; there's already other companies selling other types of food, so they're probably going to do better at it than you are since they've been doing it longer and have a brand reputation in those areas, whereas you have a brand reputation for unhealthy junk food, so you're not likely to find much success moving into, say, high-priced organic snack foods compared to the companies already competing in that space. Twinkies have been around forever, they're not going anywhere, so even if the Twinkie company stops growing, that doesn't mean it's dying, it means it's reached a plateau.
There's tons of small companies that have been around for many years (or decades, or even longer), that haven't grown because they don't need to or want to grow. As long as the owners are happy with the profit they're making, why would they want to make the company bigger, and have to deal with all the headaches that come with having a bigger operation and more shareholders yelling about how they want to do things?
Perhaps Intel should not put all their eggs (hard drives) in one basket (Asia)?
Amateur. First you cut R&D, that's long term. Then you cut the engineers, that's mid term. Then you cut support/service, which is short term. Then you bail for a competing company so you're forced to sell your options and shares. As it crash and burns, paint yourself as the great CEO that was the only thing holding that company together. Do it with enough confidence and they won't see you were the one tearing it apart. Non-sociopaths tend to believe sociopaths because they themselves couldn't pull off such a baldfaced lie. That's how they get to hop from one top position to the next...
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