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More storage, less $$$

SyQuest's new $199 drive allows one gigabyte of storage and beats comparable removable storage device offerings from Iomega.

SyQuest (SYQT) upped the ante in the market for removable storage devices with a new $199 drive that accommodates one gigabyte (GB) of storage, bettering comparable offerings from Iomega.

SyQuest's SparQ operates much like a typical hard disk drive but offers the ability to remove a cartridge for transporting data or adding storage capacity.

As hard disk drives on a typical PC grow in capacity to between 3GB and 4GB, it becomes increasingly inconvenient for users to back up information or share files with a floppy disk, which can store only up to 1.44MB of information. SyQuest said its SparQ product should appeal to everyone from small office users to traveling professionals to home PC users.

Moreover, according to Fara Yale, storage analyst with Dataquest, "To be able to get one gigabyte of extra capacity...presents an increased threat to the tape market. The big barrier in the past has been media price."

The price of a three-pack of removeable 1GB storage cartridges is $99, and single cartridges are priced at $39 each.

The new SyQuest drives outpace Jaz drives from Iomega (IOM) in terms of price by about $100 (Jaz cartridges are around $90 each in quantity). The SparQ also exceeds Iomega's popular Zip drive in storage capacity--Zip drives store up to 100MB of information. However, Zip cartridges cost about $15 now, and drives are being advertised for as low as $99.

Yale said SyQuest won't try and position the new drive as a "Zip killer," but will instead position it as a hard disk drive upgrade. A strategy of trying to compete on price with Iomega didn't pan out with previous products, plunging SyQuest into serious financial troubles from which the company is still trying to recover.

SyQuest may be able to turn things around soon, though. "SyQuest has a completely different management and marketing team, and they've improved manufacturing processes dramatically," said Yale. "Yields are way up from a year ago, and a lot of money is going into marketing the products now."

The new SparQ drives ship this month.