The program supports CD-R and CD-RW drives, Iomega (Zip, Jaz, etc.) drives, and several portable MP3 players.

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"There is a major cost to poor quality, " admits Ted Briscoe, Iomega's Zip drive chieftain.

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Previously limited to only 40 megabytes, the newer matchbook-sized PocketZip disks unveiled this week will hold 100 MB--as much as Iomega's first Zip disks when they first came to market in the mid-1990s.

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Iomega's just-announced 250MB Zip drive is set to take over as the capacity leader -- beating its largest competitor by 50MB.

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Barring a miraculous surge in demand for Zip disks and drives, Iomega's best strategic move may lie in helping other electronics companies design devices that incorporate its storage technologies.

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Instead, Iomega has made its money selling the proprietary Zip disks.

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While Iomega has done a good job of building its Zip disk brand over the past several years, it made a critical error when it reduced the prices on the drive and pinned its hopes for a long-term revenue stream on sales of disks.

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Iomega says that it also intends to keep the 100MB Zip drive and disk on the market.

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Iomega's incredible growth came almost entirely from just one product: the Zip drive.

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As Zip drives became popular in the home and small office market, Iomega discovered that most users weren't buying very many disks.

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