History (1997): Plasmon Withdraws CD-R Production

Plasmon has decided to cease CD-R media production due to their drastic price reduction, currently around $1 per disk.

The decision will no doubt involve significant job losses at the media factory in Melbourn, UK, and will entail an exceptional operating cost in the region of £9 million.

The company’s trading statement, issued on July 16, referred also to delivery problems with its new CDR 4X/8X drives from its OEM supplier, which will delay sales of its new CD-R libraries with 2 to 4 drives and 120 to 480 media.

What’s more, Plasmon’s phase-change rewritable manufacturing line, in which £5 million has already been invested, has not been profitable, due to the slow acceptance of PD technology. The company now plans to replace it with the manufacture of CD-RW disks supported by Sony, Philips, Ricoh, HP and Yamaha.

Its media division will also continue to work on the development of rewritable DVD disks, for which a cooperation agreement with Imation was signed.

On the other hand, Plasmon will not yet abandon its niche market of 5.25-inch WORM optical disks.

Behind all these new technological choices and difficulties are, not surprisingly, some personnel changes. Founder Peter Helfet resigned as group chief executive, and was replaced by Nigel Street, formerly commercial director. Dr. Chris Harris, who has served as operations director of the media division since June 1997, was appointed MD of this division.

In recent years, Plasmon’s most successful business has been the manufacture of optical jukeboxes in USA, following the acquisition of IDE in 1994, due in particular to IBM’s orders. At the same time, the firm embarked in tape and CD libraries.

This article is an abstract of news published on issue 117 on October 1997 from the former paper version of Computer Data Storage Newsletter.