Although the slowdown at Cray Research Inc has been modest, and the company has been making optimistic noises about the immediate future, it is now clear that the slowdown last year that saw sales up just 10% to $756.3m has set much louder alarm bells ringing at the one surviving US supercomputer manufacturer than Cray has hitherto let on. An apocalyptic story in a Chippewa Falls, Wisconsin newspaper, base of one of the company’s development and manufacturing centres, suggested that the company was in negotiations to sell out to Apple Computer Inc: the story was denied by Cray, but the New York Times is expecting news of some kind of restructuring at the firm’s annual meeting today. The problem facing Cray is that the slowdown in sales is crimping its ability to support the development of two separate product lines – the Cray 3 proposed successor to the Cray 2, and the C-90 successor to the Y-MP, each estimated to be costing Cray $50m a year. The company is known to be worried by the increasing competition it faces from three Japanese companies, NEC Corp, Hitachi Ltd and Fujitsu Ltd, each of which is a full-line manu facturer and even the smallest, Fujitsu, is some 20 or so times as big as Cray.
