Seagate Technology Inc launched its new U-series disk drives for low-cost PCs on Friday, amid complaints that it was cutting prices below cost to gain market share. The new models extend the existing U-series products by doubling capacity up to 17.2Gb and improving performance. They range from the U8, with GMR heads and an AT/66 interface for sub-$700 PCs through to the U2 and U4 drives for consumer electronics devices. Compaq Computer Corp, Acer Inc and Hewlett-Packard Co are taking the new drives.
Seagate says it achieves low prices through vertical integration and internal technology development resources. But Quantum Corp CEO Mike Brown chose the Wall Street Journal as a platform to accuse Seagate of cutting its prices below cost on PC drives, and then forcing everyone else to do the same. This is unsustainable he said. We can’t go on when everyone is losing money.
