William D. Watkins, Chief Executive Officer, President, Director Brian S. Dexheimer, Executive Vice President, Worldwide Sales Marketing David A. Wickersham, Chief Operating Officer and Executive Vice President, Global Disc Storage Operations Charles C. Pope, Chief Financial Officer, Executive Vice President, Finance

Kevin Hunt, Thomas Weisel Partners Laura Conigliaro, Goldman Sachs Rich Kugele, Needham & Company Mark Moskowitz, J.P Morgan Mark Miller, Hoefer & Arnett Christian Schwab, Craig-Hallum Frank Timmons, Robert W. Baird Richard Kaiser, Stanford Bernstein Philip Rose, Susquehanna Sherry Scribner, Deutsche Bank Ted Jones, Bear Stearns Robin Shah, Thinner Capital Ananda Barora (ph), Banc of America

Good afternoon ladies and gentlemen, thank you for standing by. Welcome to Seagate Technology’s Fiscal Second Quarter 2006 Financial Results Conference Call. At this time all lines are in a listen-only mode. Later there will be an opportunity for questions. Instructions will be given at that time. If you should require assistance, please press “*” then “0”. This conference call is being recorded. Portions or the subject matter discussed in the call to follow related to the proposed transactions between Seagate Technology and Maxtor Corporation will be addressed in a joint proxy statement prospectus to be filed with the SEC. We urge you read it when it becomes available, because it will contain important information. Information regarding the persons who may under the rules of the SEC, they considered participants in a solicitation of stockholders in connection with the proposed transaction, will be set forth in the proxy statement prospectus during when it is filed with the SEC. The conference call contains forward-looking statements with in the meaning of section 21A of the Securities Act of 1933 as amended. And Section 21E of the Securities Exchange Act of 1934 as amended. These forward-looking statements include but are not limited to statements related to future financial performance price and product competition, customer demand for our product and general market conditions. These forward-looking statements are based on information available to Seagate as of the date of this call and current expectations forecasts and assumptions involving number of risks and uncertainties that could cause actual results to differ materially from those anticipated, of these forward-looking statements. That risks and uncertainties include a variety of factors some of which are beyond the company’s control, in particular such risk and uncertainties include the impact of the variable demand and the aggressive pricing environment for disk drive. Attendance on the company’s ability to successfully manufacture an increasing volume on a cost-effective basis and with acceptable quality is current disk drive product. The adverse impact of competitive product announcements and possible excess industry supply where they expect particularly disk drive products, the impact of the announced transaction between the company and Maxtor Corporation on current customer demand during the period prior to a closing of the transaction, the possibly that Seagate’s depending acquisition of Maxtor will not be (indiscernible) on a friendly basis or at all. And the possibility of that the combination of Seagate and Maxtor will not provide the anticipated benefits of the combined company. Information concerning additional factors that could cause results to differ materially from those productive in the forward-looking statements is contained in the company’s annual report on Form 10-K as filed with the US Securities and Exchange Commission on August 1, 2005 and in the company’s quarterly report on Form 10-Q as filed with the US Securities and Exchange Commission on October 28, 2005. These forward-looking statements should not be relied upon as we are representing the company’s views of any the subsequent date and Seagate undertakes no obligation to update forward-looking statements to reflect events or circumstances, after the date that they were made. I would now like to turn the conference over to our host, Mr. Bill Watkins President and CEO. Please go ahead sir. William D. Watkins, Chief Executive Officer, President, Director: Thanks Lynn. Welcome and thank you for joining us. On the phone with me today, are Charles Pope, Executive Vice President and Chief Financial Officer, Dave Wickersham Executive Vice President and Chief Operating Officer and Brian Dexheimer, Executive Vice President, World Wide Sales and Marketing. Seagate closed the calendar year with the strongest quarter in the company’s history. In fact, the strongest quarter by any company in the history of the disk drive industry. Demonstrating the consistency of our financial and operational performance, we achieved record revenue and record earnings and we delivered new products for all market segments for shipping a record 28.8 million disk drives. Over the last 12 months, we’ve reported revenue of $8.5 billion and net income of $1.1 billion. Strong performance continues to result on our unique business model that has delivered a broadest product portfolio in the industry, with consistent technology, product can cause leadership. We expect this performance to continue and positively impact our earnings for fiscal year 2006. Clearly, global demand for mass storage is accelerating, with significant growth opportunities in new emerging applications as well as traditional computer applications. In fact, in the December quarter, we increased shipments 19% year-over-year. While the industry delivered its first 100 million-unit quarter, we estimate the industry shipped 380 million disk drives last year totaling 35 million terabytes, an increase of 60% from the previous year. The most exciting growth area continues to be the consumer electronics space, where new applications are constantly emerging and software makers are building new business models designed to unlock digital content for consumers to use in their home or hand or in the car. Hard drives are central to these new models, where storage-intensive applications require high capacity, cost effective solutions to store, protect and access these new flow of digital content. The annual Consumer Electronic Show clearly demonstrates that we were well in our way to roll robustly into every consumer electronic application that has a storage device in it, on it or around it. Whether it’s a car, a cell phone or a handheld video applications, it's all about delivering a beneficial consumer experience that simplifies the complexity that exists today. And Seagate is continuingly working to improve this consumer experience. These new consumer markets are now large enough for our portfolio and serve markets broad enough that Seagate has a greater degree of financial stability and predictability along with greater opportunities for growth and than are available with in the traditional IT markets. Well, a primary growth driver for our industry has been the consumer electronics market, we are also very pleased by the strong growth we are experiencing in our core markets and the opportunities ahead. The desktop market continues to see strong growth where Seagate saw an increase of 16% year-over-year unit shipments. The notebook market has shown phenomenal growth as higher capacity drives are allowing more powerful and cost effective notebook computers that are equipped to handle tasks traditionally left to desktop systems. Last quarter, the averaged capacity of notebook drive shipped by Seagate is nearly 70 gigabytes, up from 64 gigabytes the previous quarter. We expect this capacity trend to continue, and the enterprise higher capacity, higher performance drives continue to power the world’s most demanding computer systems. And they are now providing solutions for content providers to deliver capacity-intensive applications such as video through broadband, the unit around the world. As you are all aware Seagate entered into a definitive agreement to acquire Maxtor. As previously stated, we believe the combinations of the two companies will leverage to strength the Seagate significant operating scale, to drive product innovations increase operational efficiencies and realize significant cost synergies. These capabilities will enable the combined company to compete more effectively as the higher competitive data storage industry addresses the challenges and opportunities for significant growth that lie ahead. We will also uniquely position the combined company to accelerate delivery of a diverse set of compelling and cost effective solutions to the growing customer base for data storage products. There is no question that this is a growth industry and Seagate is leading the way. We are uniquely positioned and excited about what we see across all markets, as the leading disk drive manufacturer in virtually all markets and in environment which the demand for storage is at record levels and growing, we are optimistic about the future. Now, I would like to turn the call over to Brian to provide further detail on our performance during the quarter. Brian S. Dexheimer, Executive Vice President, Worldwide Sales Marketing: Thanks Bill. The December quarter reflected the growth dynamics results throughout the calendar year 2005 and expect to see continue in 2006. As Bill mentioned, the industry surpassed 100 million units in quarterly shipments for the first time and achieved over 380 million units during the calendar year representing a robust year-over-year growth of 26%. In the quarter, Seagate experienced growth in all markets as shipments grew faster than the industry rate of 15%, reaching 28.8 million units, a 19% increase year-over-year. In the consumer electronics base, Seagate shipped 3.5 million units. We expect to see a substantial increase in this volume sequentially as product transitions in the game console space reached full stride and we continue to see robust growth from the DVR market. In the DVR market, shipments grew 93% year-over-year to 2.4 million units. This segment of the CE space remains one of the greatest opportunities for Seagate. With high definition content continuing to penetrate large markets and Olympic and World Cup events upcoming, we expect to see additional demand and an improved mix towards high capacity drives in this space. In the 1-inch market, Seagate shipped just over 800,000 units in the handheld media players, GPS systems, branded portable storage and planner applications. While down sequentially, we continue to see growth opportunities in the space. We believe has higher capacities are achieved in business models for video distribution materialized. This market will experience additional growth represent new opportunities for Seagate. The mobile computing space continues to grow rapidly as the Seagate’s participation in that space. We believe the market grew 36% year-on-year to 21.4 million units. While Seagate shift 2.9 million drives in December quarter, an increase of 136% year-on-year and 20% sequentially. As the result of our expanded product line and technology leadership, we believe we gain share on this market, marking the 6th straight quarter of share gain. During the quarter, we began limited volume shipments of the industry’s first 160 gigabyte 2.5 inch disk drive for high-end notebook applications. We believe there is a significant trend to our higher capacity drives in the notebook market and Seagate is very well-positioned in this regard. In fact, Seagate’s shipments of capacity is greater than 80 gigabytes grew 39% sequentially. We do believe the industry access December quarter was some unmet demand in the space and believe it’s likely that underlying media capacity for these products will continue to be in tight supply in the March quarter. Seagate had another strong quarter in the enterprise market. We shift 3.5 million units during the December quarter, an increase of 16% from the September quarter and 6% year-on-year. We believe the industry has the whole shift approximately 6.7 million drives during the quarter representing the 6th straight quarter of over 6 million units shift. Once again, we believe our product leadership drove share gain in this space. We expect overall enterprise demand in the March quarter to be seasonal and therefore slightly lower than that of the December quarter. We’re also experiencing an improved product mix in the enterprise space as shipments of our highest capacity drives increased sequentially. As we mentioned last quarter, our SAT and Fibre channel new line products were in qualification at 10 OEMs. These products are now qualified with 5 of those OEMs and we began volume shipments during the quarter. We believe this is a fast growing applications base with continued growth opportunities for Seagate. In addition, we continue to be pleased with the customer integration on Savvio our 2.5 inch enterprise drive, where we saw shipments increased 30% quarter-over-quarter. Moving to the desktop, we continued to lead this market with record shipments totaling 18.9 million units, an increase of 16% year-on-year and 8% sequentially. Once again, our product mix continued to improve the shipments of products 200 gigabytes and greater from the 33% sequentially. As we outlined last quarter, our 160 gigabyte for flatter drives are now shipping in 4 volumes. We were very pleased with the customer acceptance of this product throughout the quarter, which resulted in a 130% increase in shipments. Moving forward, we are confident that our industry leading aerial density and cost position will continue to deliver growth opportunities in this market. As it is the case historically with March quarters, we expect overall list out demand to be seasonal and therefore slightly lower and than that of the December quarter. Overall, the industry experienced balance supplying demand for desktop products and pricing for the quarter was in the range of expected levels. Next is the quarter with under 4-weeks and channel inventory for desktop products. Finally, our Seagate brand solutions revenue grew nearly 80% year-on-year and action at 2005 at a run rate of over $250 million annual. We’re pleased with the progress we have made to date and expect further opportunities as more and more consumers see to store, share and project the valuable digital content. Brand and solutions will continue to be a high growth area in strategic focus for Seagate. In summary, we are very pleased with our performance in the market expectance of our product during the December quarter. We believe we have best position for continued growth opportunities and are excited about new opportunities in 2006. Now, I would like to turn the call over to David to provide an update on our key product programs. David A. Wickersham, Chief Operating Officer and Executive Vice President, Global Disc Storage Operations: Thank you Brian. We are very pleased that in the December quarter, we began shipping our first perpendicular drive an 80 gigabyte per player 5,400 RPM, 2.5 inch notebook drive ahead of our internal schedule. We will continue to focus on successful OEM qualification and volume ramp over the coming months. As discussed previously, perpendicular recording is a complex integration of the recording head, the desk, the recording channel, drive software and furthermore as a system. As a vertically integrated company, we are uniquely positioned to optimize the overall drive system. Our technology has maturing; our process already and we are exceeding our internal targets for component and drive yields. Given our platform strategy and successful deployment we are well-positioned not just on this notebook drive, but well prepared to integrate perpendicular recording across all product markets over the next 12 months. Last quarter, I also updated you on the progress we are making, extending Seagate longitudinal aerial density leadership, with the introduction of a 160 gigabyte per flatter desktop drive. As with the introduction of perpendicular, we are very pleased with our progress ramping to industries, first 160 gigabyte for flatter product and will complete the majority of our OEM qualifications this quarter. In the December quarter, we more than doubled our shipments of drives with neither capacities of a 160 gigabyte for flatter or 80 gigabyte for surplus and will significantly increase our outlook again this quarter. Now, I would like to turn the call over to Charles to provide further detail on our financial performance during the quarter. Charles C. Pope, Chief Financial Officer, Executive Vice President, Finance: Thank you, Dave. You will find companies press release 8K and additional financial information related to Seagate’s financial performance in the Investor Relations section of Seagate’s website at seagate.com. As stated in the press release, Seagate reported revenue of $2.3 billion, net income of $287 million and diluted earnings per share of $0.57 for the quarter ended this December 30, 2005. The $2.3 billion of revenue we’ve reported today reflects a high water mark for Seagate. These GAAP financial results include cost related to our employee stock purchase plan and stock options. These costs total $20 million with $7 million in cost of sales and $13 million below the line in operating expenses. Also included in the December quarter’s financial results is the $6 million charge for R&D for licenses related to advanced storage technology and a $2 million charge in other income and expense related to the early payment of the $340 million term loan. Seagate’s operating expenses defined as restructure development and send; Selling General and Administrative expenses in the December quarter were $307 million which includes $13 million for non-cash stock-based compensation and the previously mentioned $6 million charge for the technology license. Cash flow generated from operations was very strong a $562 million in the December quarter. Our cash balance is approximately $1.75 billion down only $41 million from the September quarter even though repayment of the $340 million term loan occurred in mid-October. Because of the announced Maxtor transaction, the company did not buyback any shares during the quarter. The full $400 million previously approved by Seagate’s Board of Directors is still available. Inventory turns for the December quarter were 13.5 up from 13 in the prior quarter. The total inventory balance at the end of the December quarter was $505 million up $28 million from the prior quarter. For the first 6 months of fiscal 2006, capital investment was $353 million with December quarter capital investment being $184 million. As demonstrated this past year, we used customer demand as the gauge to determine the proper level of capital investments. Based on the strong demand, we are experiencing for Seagate’s products during the remainder of fiscal 2006 and to position the company to serve our customers during the seasonally strong quarters beginning in September, capital investments for fiscal year 2006 will need to grow to between $915 million and $1 billion. This is a meaningful increase to our prior expectation of $700 million to $800 million and reflects strong broad base demand for Seagate products along with the need to restore some flexibility in our factories which have been running at virtually full capacity during all of the last calendar year and are anticipate the top rated phone capacity during the March quarter. Relative to the company’s outlook for the March quarter, we indicated in our press release the company expects revenue of approximately 2.25 billion and diluted earnings per share of approximately $0.55 excluding expenses related to non-cash stock-based compensation of approximately $21 million or $0.04 per share which equates to approximately $0.51 per share on a GAAP basis. Gross margin is expected to contract modestly as compared to the December quarter as normal price declines in all the markets are expected to be offset somewhat by the continued improvement in product mix and the margin improvement, our 160 gigabyte per platter desktop drive provides. Operating expenses for the March quarter are expected to be approximately $290 million excluding non-cash stock-based compensation cost. The tax rate for the balance of fiscal 2006 is expected to be 5%. Due to the dynamic nature of the disk drive industry, the outlook for Seagate’s fiscal year 2006 is subject to greater variability and less certainty. Seagate’s outlook for earnings per share for fiscal 2006 has been raised to arrange at $2.20 to $2.25 excluding expenses relating to non-cash stock-based compensation of approximately $80 million or $0.16 per share, which equates to a range $2.04 to $2.09 per share on a GAAP basis. Our full-year outlook anticipates a balanced supply demand environment and therefore normal levels of price competition, additionally our outlook incorporates executing to our plan for the production ramp and customer qualifications of the 160 gigabyte per platter desktop and 80 gigabyte per platter notebook drive and sequential growth in notebook near-line and gaming unit shipments. Finally, I would like to briefly provide an update in regards to the proposed acquisition of Maxtor. On January 13, we made our Hart-Scott-Rodino pretty much in notification filing and we will be meeting US Federal Trade Commission to discuss the merger in the coming weeks. The FTC has 30 days to complete their review or request additional information. For a transaction such as the Maxtor acquisition, it would not be unusual for the FTC to a second request for additional information as they conduct a review. The preliminary joint proxy statement is expected to be filed in the middle of March and we expect subject to SEC review in comment process that the shareholders books longer term in late June. We continue to expect the transaction to close sometime in the second half of calendar 2006. We have been very pleased with all this transaction has been received by the investment community. Even at today’s valuation, we feel that Seagate’s ability to generate earnings and cash has yet to be fully recognized. That concludes my remarks. Now, I’ll turn the call back over to Bill. William D. Watkins, Chief Executive Officer, President and Director: Thank you Charles. That concludes our prepared remarks, operator we’re ready to turn it over for questions.

If you would like to ask a question at this time, simply press “*” then the number “1” on your telephone keypad, if you would like to withdraw your question, press “*” then the number “2”, we’ll pause for just a moment to compile the Q&A roster. Your first question comes from the line Kevin Hunt. Q - Kevin Hunt: Now, thank you. A couple of questions. Can you maybe comment what do you think on the outlook for 1-inch drive as going forward. And then if you might be looking at having a 1.8-inch drive in the future is seeing, is that where, that’s seems over that, where most of the, some CE stuff seems to be going? A - William D. Watkins: All right Kevin, I will let Brian to answer that, I am not allowed to make product announcements offline. A - Brian S. Dexheimer: They are still in and I don’t want make any product announcements Kevin. But we were very excited about the whole mobility space. So, years talk about things going on in the hand holding card, really this addresses the hand space and so, I have which is my comments, the 1 inch market is very much alive and we continue to find new application spaces for that, and our technology leadership and our ability to put very high capacity in that phone factors interesting provided those reasons in those applications. The 1.8 inch space we are looking at that with very keyed level of interest, we believe that’s a very robust market at this point in time. And that’s got nice growth, potential in front of it. Not only in the BES space, but also potential in the notebook space in the future. So, I think you are going to expect that you will see us continue to look at that with a lot of interest and continued to make investments in that space for the next several quarters and at some point we will be making a product announcement. Q - Kevin Hunt: Okay and I have follow up for Charles, actually couple of things. I think, thought you would say 5% for the tax rate for the remainder of the year, that is the first things and the second thing is, can you give us an indication on new product contribution in this quarter then kind of things, probably in the next couple of quarters. A - Charles C. Pope: Okay Kev, and in the guidance that I gave in my prepared remarks we have modeled in 5%, we believe that’s kind of at the high end of the range where it will be, but for conservative reasons, felt that it was prudentially heading model at the end of 5%. A - Brian S. Dexheimer: You know a year ago when we had a complete turn over of our products. We talk continually to flip the difference shown margin less for the new products versus the older sets. That has largely turned over this point in time and trying to distinguish some of the incremental margin, on saving 160 gigabytes 2.5 inch which just really started shipping, versus some of the owner’s note. It is not a meaningful number. So, I think that at this point in time you need to kind of look at the blended number and we still feel good about operating in this 24% to 26% margin range, as we have. Q - Kevin Hunt: Okay, thanks a lot.

Your next comes from the line of Laura Conigliaro. Q - Laura Conigliaro: Yeah a couple of questions Steve, first on the notebook side, your notebook business is obviously is one of the biggest incremental contributors in the last couple of quarters. You made some comments that suggest some pretty strong notebook growth combined with the back that you are saying that, there was unmet demand exiting the quarter and media remains tight. Are you suggesting with that kind of comment that we will potentially actually see non-seasonal growth sequentially in the March quarter. And then once you start to see some of the media listen up. What is your expectations, since the other side of that, the offset to that is that, is your technology as well as your ramping market chair. So is it possible in the slower quarters of March and June, you actually could see some growth on the notebook side. And then finally can you help us understand, perhaps even quantify, what your technology leadership means as far as your cost advantages and also margin opportunities are, are you beginning to see any of these in share gains. A - Stephen J. Luczo: Laura I let Brian take the notebook question and Charles come back on the cost side. A - Brian S. Dexheimer: No, let me try and deal with the notebook. As the matter that we see in front of us, 3 things I will point you to, one is clearly in the client space we’ve seen product transmission and demand patterns based on OS, processor transitions as well as seasonal opportunities. I think what you have to do on this notebook underneath that because this point on gear is very structural shift to mobility away from stationary client computing. So, in addition to the normal things we are use to seeing in client 2 which are these processor and OS transitions as well, seasonal buying patterns. Underneath that in this one we’ve got that structural shift going on. So, we think that will give this one more strength than maybe some of the other of supplying demand in balances we’ve seen different segments in the past. Second thing I’d tell you is competing for the supply chain cool, there is also new applications coming into 2.5 inch space, mainly in the gaming console environment, there are a few others, they are now competing for this supply chain. So, if you just look at 2.5 inch drives then there is more reason to believe that there is more demand for those and I think the answered question about sequential growth, quarter on quarter I think she include those types of products in all 2.5 inch, and we varied much to expect to see sequential growth from December to March. Q - Laura Conigliaro: Actually the, I am sorry, I was not including gaming I was really trying to think of the traditional business, where you are ramping your market share there anyway and you’ve got a technology edge. A - Brian S. Dexheimer: Right, so in the notebook space I think still that structural shift is true and we look for the market to be just looking at notebook flat maybe slightly up quarter-on-quarter. The third thing I will tell you that’s the specific benefit to Seagate, maybe addresses some of your technology question, I will hand it to Charles is, we see from a share perspective more home pull of products because of this technology leaderships. So in addition to the 2 things that I gave you that were structural for the industry and I think we see an additional benefit, because of the technology where we should be on the product. So I let Charles to answer a margin question. A - Charles C. Pope: Okay, Laura to try to answer your question of quantifying further technology leadership is doing for Seagate, let me give you 2 specific example. One if you sit and look at the 160 gigabyte for flatter drive we are able to do that capacity point with 1 disc and 2 heads. All of our competitors at this point in time are required to do 2 discs and 4 heads. You have available to you market data on discs and heads and they, if they are purely dependent on the merchant market, the average price per disk is a little more than $6 per disk. And a little more than $6 per head, and so there is an $18 cost differential for the same capacity point that exist on that drive, which, when you are talking about entry level products, that is a very large differential to work with. When you said you talked about the technology leadership on the notebook, you don’t measure it in terms of margin, you probably measure it in terms of share, because with the new notebook product that we just introduced, the 160 gigabyte 2.5 inch, you don’t have the ability in that form factor to put it additional heads and disks and so it just becomes a matter, what leverage does that can give you to increase your market share, what opportunities to increase your market share within your customer base, which again drives the increased gross profit dollars, you don’t really have a gross margin comparison out in the industry to match it again. And so those are the types of things that I think the technology leadership are driving. Q - Laura Conigliaro: Thank you.

Your next question comes from the lines Rich Kugele from Needham & Company. Q - Rich Kugele: Thank you, a few question, I guess first, perhaps this best for Brian, regarding Maxtor in general terms which capacity points are even ends with the market. Do you think are most interesting for you to try and maintain a presence then we, when you break up their share. And you look at the opportunity is their for perhaps a capacity point, would you want to make sure you stay such as, high cap, near-line, the low cap business in Latin America, any thoughts there? A - William D. Watkins: This is Bill actually; it’s too early for us to really talk about products strategies with Maxtor and what we are going to do. So, we’re just not going to comment on that time and them probably can’t, and that walk pretty more forward thinking about this as we get closer to the deal. Q - Rich Kugele: Okay, fair enough and then, I guess secondly just to dive in a little bit deeper on the 160 gig platter, traditionally there has been obviously a very compelling advantage as you, Charles you were talking about the cost differential. But there is also always a reason to perhaps lower price to try and gain share, the industry is very different now it’s effectively two large players on the desktop last. Can, do you think that perhaps this time around you might be able to broaden that 24% to 26%gross margin range, because you don’t need to price, you are going to get the share you are going to get as it is and you can just actually pocket the difference this time. A - William D. Watkins: Well, Charles take that. A - Charles C. Pope: Well that’s the way that actually turns out, that will be great and that would be our hope is that we can do something like that. Because the expectation strategy, we would be able to accept market pricing and there is really no incentive with in the market for people to get overly aggressive on the 160 gigabyte capacity points which are together. Some improved margins to offset some of the very entry level products that have very low margins. Q - Rich Kugele: Okay, thank you very much.

Your next question comes from the line of Mark Moskowitz with J.P Morgan. Q - Mark Moskowitz: Thank you, I have few questions within me, I don’t want to beat up on the 160 question, but I want to see if you can give us spend at least now; what is the average capacity you are targeting with your 160 gigabyte per platter. Is that only 160 or you also going after higher capacity as far as even from the 320, 400 or 500? I ask you that and trying to get a sense of what can really be the true margin impact as we think about higher capacity trials become the greater peaceful mix going forward? A - Brian S. Dexheimer: Hey, Mark Moskowitz let me take that one. The 160 today is a 160 and that’s where we are targeting it forward, we have plans in the future to incorporate that into a higher capacity drives in that point of time, when the technology is incorporated, while others will be targeting capacity is during excess of that. Sure to think about things like 500 gigabytes. Q - Mark Moskowitz: Okay, thank you. And then as far as the enterprise environment, it seems like you’ve pretty much enjoyed the nice steady momentum in the December quarter. I wonder if you can first give us a sense of how that broke across fibre channel versus SCSI, and then as far as the typical seasonal growth for the March quarter should expect SCSI and fibre channel fall that or can get less than that, given your near-lines data exposure, what’s common? A - Brian S. Dexheimer: Well, Mark, this is Brian, I’ll take that one again too. When we talked about the enterprise, we really are capturing just the SCSI and fibre and classic, and what we call mission critical enterprise business. So, really address the fibre and SATA, near-line space somewhat separately from that. So, when we talk about 3.5 million units, that’s the classic definition that we’ve always used to define enterprise shipments. So, I just want to be clear about that. In terms of distinguishing what happened in the December quarter, I’d say we saw a good strength across all product lines; one was not particularly stronger than the other. Through out the quarter, certainly was waited more until December, we saw more strength in the back half of the quarter, which gives us some confidence around the March quarter being, maybe less seasonal then it has been in the past. So, we will be hopeful that the disclosure being flat. As we look at this March quarter, again, I wouldn’t distinguish it for you between SCSI, SATA or fibre in terms of any differential levels of strength. Q - Mark Moskowitz: Okay, and then lastly Charles if you could, do you have sense of how we should think about the tax rate a longer term given with the industry outlook, do you think its the same to be on improving track and honestly your profit outlook is improving by the day, should we expect this tax rate to move up towards 10% I know you have a good deal packs holidays and some of the programs, and then keep that down by, maybe you should way in their please. A - Charles C. Pope: Well, I’ll need to address this question on the Seagate standalone basis; we don’t really have a basis yet to evaluate what the tax rate would be on a combined basis between Seagate and Maxtor. But as we sat and look out the, where our revenues and profits associated with the companies are, they tend to be very strongly concentrated outside of North America, and consequently given the structure to company, we believe that we can probably maintain a tax rate out the 5% to below level for an extended period of time since we sat and look at it. Q - Mark Moskowitz: Thank you.

Your next question comes from the line of Mark Miller with Hoefer & Arnett. Q - Mark Miller: Since, no one else said so, congratulations on another record quarter, very wonderful quarter. Just 2 questions here, you’d Charles want to some detail to discuss the end managers from component, lower component counts, we will have 160. Mostly, we’ve also have the advantage since you will be several quarters ahead of your competition. In terms of learning curve efficiencies, which translates in the better yields, I am just wondering how much cost to manage that is since I assume you will be the ahead of the yield curve , because you’ve been producing 160 gig longer. A - William D. Watkins: All right that’s absolute, the accurate, we began shifting the 160 gigabyte per platter product in volume in August last year. And so given the fact that we’ve only heard a sched on the map from one another competitor, and it was kind of, somewhere this time it seems we may, will have a year lead on the competition there. Its been a while since I’ve calculated it, but to drive level 1% point of yield can be anywhere in the range from $0.08 to $0.12, $0.15 or something. And so you are right, maturing and getting the yields up and then coming down the cost curve with your suppliers and everything else gives you an incremental advantage beyond just the lower component count. Q - Mark Miller: Sure, the second question is guess, the two questions about merger of Maxtor, is revenue attrition and certainly I, was bullish as anybody about your retrained more of it. But I just wonder if you can address, how ready how are you, compared to your competitors, who were at full capacity and won’t be buying a new plant in China and elsewhere. Already are you to be able to produce including components, I see you raised a CapEx. Virtue have an event or simply because you are getting this plan all the people that have the build news plans, ad capacity your fine new sources for components. I am just wondering if you can talk about that? A - David A. Wickersham: Its Dave, Mark let me take, its Dave Wickersham. So as far as how we are prepared to begin it, it’s a little early and the apple outlook that we provide, I want to clarify that is a kind of organic, Seagate Pro. So with Charles outlook, it likes purely the Seagate organic growth that we’d anticipate given our customer fallen demand. As far as our ability to leverage going forward, one of things that we highlighted as significant assets of Maxtor brings to the table is media capacity as well as the China facility that you’ve mentioned. But from our perspective, that perhaps bring another advantage to leverage the fixed assets that we have today as well as some of the assets and resources that Maxtor would potentially bring to the combined company. So the other thing again, back to our model that your familiar with that I think it just a very unique opportunity and that is it’s just a whole deal is about leverage and scale and it’s ramping the process is we know, the products we know, the assembly lines, the test lines we know. So, we think that takes the considerable amount of risk out of the deployment and transition to the share volumes going forward, so I would think that we’re again uniquely positioned because we’ve got both Intel components additional capacity for one of the precious and constrain commodities namely in the media, as well as some of the assembly capacities that the China facility will bring to the combine company. A - Charles C. Pope: Mark this is Charles, let me elaborate on that one that was in the call we had when we announced the acquisition, the question was that whether or not we might be bringing out some capacity to facilitate the transition of products suppose to go and we indicated at that times that would certainly make sense and that we would look at that it’s a little bit to early to evaluate with you have finalize evaluating, what that means to us and how we might go about doing that certainly as we go throughout the next few months and I would hope that if I, the time we have our April call, we would have some meaningful information to give everyone on that depending on the status of the close. Q - Mark Miller: But that I guess from not much what you said with you certainly you have a I assured a rule to go where the someone who is trying who gain share from Intel who is not inherited the plan that you guys double to and the advanced even retrain good deal of that shares simply version of how to do as much is I believe you could comment as like to do is that correct? A - David A. Wickersham: Mark, Dave again, let me, I would say I agree with that I think, the other point I would make and is the unique advantage in terms of being a head of the curve on product transition and technology transitions, so while folks are contemplating what’s your ramp and where to ramp we know that technology as Charles indicated we maturing the technology, so we’re I believe in a comparative advantage likewise and we’re not behind the curve from a technology or product perspective. Q - Mark Miller: All right thank you.

Your next question comes from the line Christian Schwab with Craig-Hallum. Q - Christian Schwab: Quick question regarding the 160 gigabyte platform, how long before you believe you will be close to a 100% utilizing that platform on both the 160 and then the 80. A - William D. Watkins: Close to a 100% by the June timeframe. Q - Christian Schwab: Wow, and so then that wouldn’t would to be logical did that without making product and so it will logical that of course we would take a bladder out of the 320 and a flatter out of this 500’s would be able to tweak the heads too 167 platters that logical? A - William D. Watkins: It’s logical the new products coming out. Q - Christian Schwab: Fabulous that’s all I have thank you. A - William D. Watkins: Thanks.

Your next question comes from the line of Frank Timmons with Robert W. Baird. Q - Frank Timmons: Hi thank you. I think you mention that script that feedback from the investor community on the proposed merger was really positive and I am just curious what feedback have you gotten preliminary from your end customers? A - Brian S. Dexheimer: Yeah Frank this is Brian, we set a pretty expensive dialogue as you might imagine with customers globally and I would characterize that feel very supportive the rational behind the, those acquisitions. Q - Frank Timmons: And with respect to, and that feedback, does it change your thoughts all about the potential revenue impact, about the share loss? A - Brian S. Dexheimer: All right, this is pretty consistent with what we announced today we announced a merger which is just those transaction believes highly accretive that it relatively aggressive to assumptions around revenue attrition and as we said in that call we reiterate again, we think we can do much better than most aggressive assumptions. Q - Frank Timmons: Okay, I thank you and my last question would be to ensure not that we seen any change in the computer dynamics and how they might be rank into that? A - Brian S. Dexheimer: No I don’t things to like if your questions where on price behavior or any product announce from competition, I’ll think we seen any thing at this stage it’s early, we certainly would expect that our customers are competitors with viewed us propose acquisition in the same light than you may have used once in the past, a little enter something difference since here in the past competitors have been from mergers of this type and so you can expect that they will try to anticipate where they may identify so acting the code loan that’s so far we haven’t seen any movement. Q - Frank Timmons: And nothing more like aggressive sales tactics or camping’s that way? A - Brian S. Dexheimer: Not so far. Q - Frank Timmons: Thanks a lot.

Your next question comes from the line of Richard Kaiser with Bear Stearns. A - Brian S. Dexheimer: You are there Richard? I think we move on to next question. A - William D. Watkins: Yeah.

Your next question comes from the line of Philip Rose with Susquehanna. Q - Philip Rose: Hi thank you. Perhaps I missed if could you go through by-product segment the directional change in blended ASPs and then about what drove the overall increase in the ASP and then finally I don’t know if I missed it but did you provide new revenue guidance for the full fiscal year for 2006. Thank you A - Brian S. Dexheimer: I’m trying to take him in reverse order okay. We didn’t provide new revenue guidance for full fiscal ’06 and the ASP let me address the overall blended ASP first it went up about $2 quarter-over-quarter that was absolute a product mix result because in everyone of the product categories there was price erosion from the September quarter to the December quarter and in fact there was a little bit more erosion in the December quarter and there was some in September quarter but it’s a still at the low end of the historical ranges so that it was represented the environment that we have described to you where there are some component tightness of relatively balanced environment for us there is not abundance of product down the channel either. So and we’re expecting a normal environment it relative to pricing in the March quarter kind of that low end of historical ranges that it still again price erosion with them all the various product category. Q - Philip Rose: Thank you.

The next question comes from the line of Sherry Scribner with Deutsche Bank. Q - Sherry Scribner: Hi thank you. You commented on the type of the class media, but I didn’t hear anything on a aluminum can you give us any detail on the tightened send that, and I have follow up. A - David A. Wickersham: Yes, Hi Sherry, Dave Wickersham, I’ll take that yes in addition to last subsidiary constraints we continue to see very tight supply on the little bit on both subsidiary finish media capacity so despite the fact that Seagate and other independent media suppliers have had a capacity that some of the growth and mix of the Brain describe with us coming from PBR or near-line in our case, we continue to see very, very strong mix up and demand on components so we continue to see our storage in aluminum as well through this quarter. Q - Sherry Scribner: Okay thanks. A - Brian S. Dexheimer: Describing that storage I want to emphasize that the outlook for the given to your completely independent with components for the guidance that we have given. Q - Sherry Scribner: Okay and then also on the inventory I noticed that the finish goods number picked up a little bit sequentially can you give us any color on that and what maybe in that number. A - Brian S. Dexheimer: Sure, periodically we find it’s appropriate to place some product on surface and in this particular case ocean transport in set of air particularly on entry level products where there very low margins and we have an opportunity to save some money so that even looking at the time value of money it’s very worthwhile to use promotion shipment. We choose to do that towards the end of December to position some products for the month of January. Q - Sherry Scribner: Okay great thank you.

Your next question comes from the line of Richard Kaiser with Bear Stearn. Q - Richard Kaiser: Hi I am sorry it’s Stanford Bernstein. Thanks for taking my question, a couple of things. First on, it seemed that inventories grew significantly faster than sales in a quarter and finish goods where there 50% as you reported, Hutchinson also increased inventories and last Intel said channel inventories was up. My question, I guess is did your channel inventories increase in the quarter? A - Brian S. Dexheimer: No they did not. Q - Richard Kaiser: Okay. A - Brian S. Dexheimer: I think, one of your comments because I talked you said finish goods was up 50%? Q - Richard Kaiser: Enhancements please? A - Brian S. Dexheimer: It was up $28 million so that, it was up less than 10%. Q - Richard Kaiser: I think I am speaking on a sequential basis so let me see. A - Brian S. Dexheimer: I am not…. Q - Richard Kaiser: Sorry for the confusion. Yeah I’ll just have to take a look, and second with respect to placing you seemed to employ in your release, placing on a rate basis was down and can you just talk about why that’s reverse versus recent kind of trends. A - Brian S. Dexheimer: You mean 5 was more aggressive. Q - Richard Kaiser: I am sorry the finish goods just for clarification in your release though it’s finish go through up on year-over-year 56% did I miss to read that is there some miss statement in that release? A - Brian S. Dexheimer: Year-over-year I don’t note the number of… Q - Richard Kaiser: Yeah its 56, okay good. A - Brian S. Dexheimer: I think in the December quarter… Q - Richard Kaiser: Yeah. A - Brian S. Dexheimer: A large part of the pricing is actually determine that the end of the September quarter and I think that, that was an expectation that there would be more capacity and more products available in things like that so we did find the environment for the pro-pricing in the December quarter to be a little more aggressive. It help during this quarter well but it was, see for the declines than in the September quarter and thus you can see those declines were upset by product mix and, and cost reductions. Q - Richard Kaiser: Are there any particular product categories which driving reduction analyst? A - Brian S. Dexheimer: No, it was pretty broad space. Q - Richard Kaiser: Okay great, thanks for taking my question.

Your next question comes from the line of Ted Jones with Bear Stearns. Q - Ted Jones: Yes, I, just a couple of things to qualify. Did you say that the SEC filing was complete on January 13 or is yet to be completed on January 19? A - Brian S. Dexheimer: The Hart-Scott-Rodino referred to filing those forms January 13. Q - Ted Jones: Okay, and you said that the proxies for the merger as well as the, of the share insurance fully acquisition will be solved in mid March, is that correct? A - Brian S. Dexheimer: Correct. Q - Ted Jones: Why is that taking so long to follow this proxy? A - Brian S. Dexheimer: Well we have a number of things that we need go through you have Maxtor and Seagate both running to get their in RK 10-Q and RK 10-K out and have finalized to review in the audits of all of those and so that’s probably been biggest stake in the sign line of the preparing these documents. Q - Ted Jones: Okay, great thank you. A - Brian S. Dexheimer: Anymore questions?

The next question comes from the line of Robin Shah with Thinner Capital. Q - Robin Shah: Yes, hi, I have just one question. Equate Seagate 2006 guidance; you structure in any our market share… A - Brian S. Dexheimer: No we can’t really hear the question, could you have Robin speak out through more closer to a phone. Q - Robin Shah: Hello, can you hear me now. A - Brian S. Dexheimer: Yes thank you. Q - Robin Shah: So my question is for your Seagate standalone 2006 guidance. Do you expected in any market share loss as the result of the potential merger is next to… A - Brian S. Dexheimer: Robin, this is Brian let me take the attendance, answer been definitive no we don’t, we don’t see any organic should allow some Seagate site because we announce acquisition for 2000 service. Q - Robin Shah: Okay thanks. A - Brian S. Dexheimer: We will take one more question.

The next question comes from the line Ananda Barora (ph) from Banc of America. Q - Ananda Barora: Hi guys thank you for taking my question. I guess just a sort, two things 1) getting back to the mediate tightness, term I guess on the last earnings call sort of have been stimulated that substrate tightness, might persist, I guess the way you made it sound buyer is as well as lies was for the portals, you know the calendar years fix because the time that you get equipment from the substrate equipment manufacturers its kind of, it sounds like, we’ve pushed out I mean by two quarters, so given the pricing it looks like, sort of I guess it’s the, the high I guess in a lower end of seasonal in December quarter and may even see to next couple of quarters, so I get here your thoughts on, what we should expect from a substrate media, I guess capacity situation. I know it’s a toughest job but this is just what you’re seeing here right now as we head into this year? A - David A. Wickersham: This is Dave, let me take that again. In the case aluminum substrate like glass substrate we have to add incremental capacity. We as an industry both the components of Fire, Seagate and others so that seems consistence that in our 30 delays and these as a ramps sort of that’s for in terms of getting capital equipment on in terms of coming up yield curves, qualifications et cetera, there is this time such business for in but it is tight and we remain tight. And I would say that, that would continue through the balance of the calendar ’06, that’s correct. Q - Ananda Barora: Okay thanks a lot. And then I guess last question enterprise business sort of take it that in previous conversing result. Enterprise business I guess, mark a wide seems to be a little bit and expect the December quarter and, three year results and other results of others, is there any I guess incremental positive demand that you guys are seeing I mean, which you think will carry through, or do you think it’s a sort of a like a December quarter budget flash last and something was peculiar going on here? A - David A. Wickersham: You know, other than the comments that Bill made his opening as, the evidence of the 60% year-on-year growth and had to buy some sort of reviewing measure that you want to make. But I think a lot of times, people confuse our success and growth in the consumer electronic industry as, only attributable to that segment, and in fact if you look at where the content and flows from and in some cases to, which enterprise how much of that was well and so some of our enterprise customers I believe are benefiting some facts, the content is moving rapidly and proliferating more rapidly as per se evidence in the, in the kinds of numbers that we offer, which I think there is somebody enterprise growth as you can attribute to been associated with growth and consumer electronics and specifically current improvement. Other than that it’s not found anything secular from the IT industry that will be causing any unusual growth clearly I think, where we say mostly in December was seasonal as we see in most December quarters. Q - Ananda Barora: Okay guys thanks a lot. A - David A. Wickersham: Nice thank you.

So, on behalf of the entire Seagate management team I like to thank our Seagate employees around the world for the contribution from that outstanding quarter. Thank you all for joining the call and afford to see in next quarter. Thanks.