The winners and losers in the OEM disk drive business are diverging at the speed of light, and while Conner Peripherals Inc is sweeping all before it, Priam Corp, San Jose, California has fild for Chapter 11 bankruptcy protection, and cut its worldwide workforce by 35% bringing it down to 380 people. Problems began when it got nine months behind with its high-end 760Mb 5.25 disk, which finally arrived after most of the market had chosen a supplier in this size; as a result, Priam is killing the disk after failing to raise the cash to put it into production. The company also needs cash for a potentially hot new product, a 3.5 drive storing 400Mb, code-named Shrike, which it says is in final stages of development; it now plans to devote all its resources to this product, but it doesn’t have the resources to do so without protection from the creditors hammering on its door.It’s most recent financial report, for the year to July 7, showed a net loss of $25.5m on turnover down 14% at $123m and cut 230 people, 25% of its then workforce, in August (CI No 1,251).
