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Technology Stocks : C-Cube
CUBE 36.52+0.3%Dec 12 9:30 AM EST

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To: JPM who wrote (32901)5/4/1998 5:10:00 PM
From: John Rieman   of 50808
 
Nimbus doubles DVD production capacity for Divx......................

ijumpstart.com

To ensure Nimbus is ready to handle demand for Divx discs and DVD media, the company will spend $22 million to increase annual manufacturing capacity to 28 million units by August.

The contract with Digital Video Express specifies a certain number of discs Nimbus will manufacture this year, which Faulkner would not reveal, and includes provisions to look at demand for the discs at certain periods over the next five years.

"It wouldn't make any sense for us to go out and buy 150 million units of capacity this week and sit on it," said Faulkner, describing the agreement as one that protects both companies.

Faulkner said the $22 million investment to increase capacity will cost "about double the amount we spent last year to get into it [DVD]."

And that manufacturing increase includes capacity for single-sided, dual-layer DVD-9 discs, which the company is producing today.

Faulkner said manufacturing a Divx disc includes a small incremental cost over the price of producing a DVD-Video, but he would not reveal the price for competitive reasons.

John Town, Nimbus vice president of R&D, said manufacturing a Divx disc takes four to five seconds longer than making a traditional DVD-Video disc.

It requires adding code to the aluminum stripe in the lead in of a disc that checks a flag encoded to play the disc for two days. He compared it to adding information to the burst-cutting area of a DVD-ROM.
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