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Computer Users Skip the PC When it Comes to Their Taxes

Media please contact:
Chris Romoser, Iomega Corporation, (858) 795-7148 romoser@iomega.com

Analyst/Investors, please contact:
Barry Zwarenstein, Iomega Corporation, (858) 795-7190

For Immediate Release

National Survey Commissioned by Iomega Corporation Finds Early Adopters of "Taxes and Technology" Put Their Tax Data Files at Risk With Poor Protection Plans

SAN DIEGO, Calif., March 3, 2003 - As Internet users continue to integrate the personal computer into nearly every aspect of their lives – downloading the latest music, planning vacations, checking stock portfolios, emailing friends and making purchases online – one important task continues to be done the old-fashioned way: income taxes. A new national survey of U.S. online adults, commissioned by Iomega Corporation (NYSE: IOM) and conducted by Harris Interactive®, found that nearly two out of every three Internet users do not use a computer to prepare their taxes.

Despite the popularity of tax software available to computer users and the push by the Internal Revenue Service for Americans to file their taxes online, the survey revealed that a surprising 62% of respondents do not use a computer to prepare their annual income taxes electronically, electing instead such alternatives as doing their taxes with pencil and paper, or seeking the help of an accountant.

“The computer is king except when it comes to taxes and Uncle Sam,” said Robert Borden, vice president, customer advocacy, Iomega Corporation. “With the advent of tax software, the conversion to preparing taxes on a personal computer is ongoing, but like broadband, it’s not happening at the breakneck pace that was expected. And interestingly enough, early adopters of ‘taxes and technology’ are learning some hard lessons for the rest of us, like the importance of backing up electronic tax data to a secure location. It appears that most don’t.”

“The beauty of Iomega Automatic Backup software is its flexible and convenient approach to file protection,” said Jet Martin, product general manager of Software Solutions, Iomega Corporation. “Combined with Toshiba’s portable hard disk drive, the hassles of data protection are removed. Users fall in love with Iomega Automatic Backup software the first time it prevents a data disaster, since it gives them peace of mind that their important files are safe.”

Who Prepares Taxes By Computer
According to the survey, respondents with higher education, higher income, who are married, or who have children, were more likely to do their taxes electronically:

  • Education: 50% of those with a college degree indicated they prepare their taxes with a computer, versus 26% for high school graduates or less;
  • Income: 49% for those with income of $75,000 or more; 28% for those with income of less than $35,000;
  • Marriage: 41% for married respondents versus 33% for respondents who were single, divorced, separated or widowed;
  • Children: 42% for those with children; 36% for those without children

Who Backs Up Important Files
When it comes to record-keeping, old-fashioned trends prevailed again. Of those who used a computer to do their taxes, four out of five (80%) kept a printed copy of their tax files. More than half (53%) kept the electronic copy of their tax files on their computer hard drive, but fewer than half (43%) backed up that data to an external storage device such as a floppy, CD, or Zip disk.

These deficient backup habits had the expected result: 12% of those who used a computer to do their taxes said they had lost electronic tax records due to a “computer disaster.” And overall, nearly one out of every two online respondents (44%) reported losing important data files due to a “computer disaster.”

Smart File Backup: The New Necessity
“The underlying story in the survey is that people still aren’t protecting their electronic tax records,” said Borden. “By relying on paper, they lose all the advantages of having their data in digital form, and they have to remember where the shoebox is in the closet. Keeping critical files like tax records only on their computer hard drives can also spell real trouble. A computer virus, hacker, hard drive crash or even an accidental deletion can result in the loss of important data. The safer, smarter route is to put those tax files and other important computer records on removable storage, such as a Zip disk, floppy disk or CD.”

Iomega Corporation makes the popular Zip drive and other portable storage devices. For protecting critical data, Iomega Recommends the Zip platform for its superior reliability and performance compared to popular CD-R alternatives:

  • Zip disks can hold more data (750MB versus 700MB for CD-R and 540MB for CD-RW).
  • Zip disks offer password protection for securing confidential data.
  • Zip disks are rewritable. (CD-R is a write-once medium).
  • Zip disks are more convenient for file management.
  • Zip disks are more reliable and durable.
  • Zip disks are protected from scratches by a rigid shell.
  • Zip disks are more easily pocketable and transportable than CDs.

Survey Background Information
The national survey of online users, commissioned by Iomega Corporation to determine how computer users protect their critical tax records and other data, was conducted by Harris Interactive® via its QuickQueryTM online omnibus service from Feb. 13-17, 2003, interviewing a nationwide sample of 2,446 U.S. adults (18+). The margin of error is approximately (+/-2.8 percentage points with a 95 percent level of confidence, and the data were weighted to be representative of the total U.S. adult population on the basis of region, age within gender, education, household income and race/ethnicity.

About Iomega Corporation
Iomega Corporation provides easy-to-use, high value storage solutions to help people protect, secure, capture and share their digital valuables. Iomega's award-winning storage products include the popular Zip® 100MB, 250MB and 750MB drives, high-performance Iomega® HDD Portable Hard Drives that feature capacities from 20GB to 60GB, Iomega® HDD Desktop Hard Drives that offer capacities from 40GB to 120GB, the new Iomega® Mini USB Drive, and Iomega® external CD-RW drives. Iomega simplifies data protection and sharing at home and in the workplace with Iomega® Automatic Backup software, Iomega® Sync software, HotBurn® CD-recording software, and Active Disk™ technology. For networks, Iomega® NAS servers offer capacities of 120GB to 720GB. Iomega also offers businesses and consumers a comprehensive data recovery services solution for recovering lost data due to hardware failure, file corruption or media damage. The Company can be reached at 1-888-4-IOMEGA (888-446-6342), or on the Web at www.iomega.com.

Note: The statements contained in this release regarding production and distribution of the Iomega product, anticipated product pricing and availability, expected product performance and specifications, future applications for the product and all other statements that are not purely historical, are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All such forward looking statements are based upon information available to Iomega as of the date hereof, and Iomega disclaims any intention or obligation to update any such forward looking statements. Actual results could differ materially from current expectations. Factors that could cause or contribute to such differences include, but are not limited to, market acceptance of, and demand for, the Iomega product, any difficulties encountered in ramping up production or other manufacturing issues, including component availability and pricing, co-development, production, and distribution issues, product pricing and conformity to specifications, dependence upon third party suppliers, competition, intellectual property rights and other risks and uncertainties identified in the reports filed from time to time by Iomega with the U.S. Securities and Exchange Commission, including Iomega's Annual Report on Form 10 K for the year ended December 31, 2001, and its most recent Quarterly Report on Form 10-Q.

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Copyright© 2003 Iomega Corporation. All rights reserved. Iomega, Zip, Peerless, Predator, DataSafe, QuikSync, HotBurn and LifeWorks are either registered trademarks or trademarks of Iomega Corporation in the United States and/or other countries. Certain other product names, brand names and company names may be trademarks or designations of their respective owners.