A new company, Elite Storage Products Ltd, has risen out of the ashes of NEC Corp’s UK disk drive division, the remnants of which were disbanded in June this year. The division sold disk drives for personal computers and mainframes, manufactured by NEC in Japan and the Philippines, to the rest of the company and on the OEM market. According to a spokesman, there were no longer the volume sales in the UK to justify continuing operations and so all European sales have been centralised in Germany – NEC has long-term commitments in Germany with Siemens Nixdorf Informationssysteme AG and Philips Electronics NV: the German sales office says it sells disk drives in Germany only via distributors and OEM. There are distributors in the Netherlands, Belgium, Switzerland and Greece, so the nearest UK contact is Rotterdam-based Machus NV. There has been a severe price erosion on Winchester and floppy drives and as a result Japanese firms, with high local overheads in Japan, have found it difficult to compete on price in the OEM marketplace with disk drive specialists such as Seagate Technology Inc and Conner Peripherals Inc, which manufacture in cost-effective Singapore. But the NEC spokesman in the UK denied the suggestion that his company had pulled out of the UK and could pull out of Europe because it was not prepared to continue funding expensive research and development work. Elite Storage Products, based in Reading, Berkshire, was set up at the end of August by four ex-NEC employees. Rather than sell NEC’s products, the firm is choosing to concentrate on assembling add-on customised boxed storage products that plug into the SCSI port of IBM-compatible and Apple Macintosh personal computers. Customised products make up only about 10% of Elite’s sales in the UK at the moment, but the company aims to increase this to 50% over the next year by ‘aggressive’ advertising and marketing. The bulk of its business currently comes from selling Tokyo-based YE-Data Ltd’s standard floppy disk drives and Irvine, California-based Ci Design Inc’s cabling and storage accessories to authorised high street resellers, such as London-based Micro Anvika Ltd, and to small and medium-sized personal computer manufacturers. The products are sold unbadged. Elite will soon also distribute Toshiba Corp 3.5 drives. Some 80% of all Elite sales are made via OEM and reseller channels, which sell customised kit too. The remaining 20% comes from selling direct to companies. Elite customises Ci Design’s empty external storage boxes by adding components, such as Winchester or optical drives and CD-ROM, to match a customers individual requirements. Ci also supplies cabling. Options for Apple dealers include Sankyo Seiki Co tape streamers, which can upgrade the storage capacity of a file server or personal computer, if a Winchester drive is added. Or Fremont-based Syquest Technology Inc’s 44Mb and 88Mb removable cartridge Winchester disk drives.
