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Technology Stocks : C-Cube
CUBE 37.90+0.6%Jan 12 3:59 PM EST

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To: dppl who wrote (585)5/29/1996 9:59:00 PM
From: Emp Lee   of 50808
 
I asked Mary Sharpless some questions regarding the Divicom merger.
Here are her responses:

RE>Acquisition of DiviCom 5/28/96

Please see my response below...

--------------------------------------
Date: 5/28/96 5:10 PM

Regarding the Divicom merger, does it mean that C-Cube will no longer supply
chips to other encoder makers?

- No. DiviCom will operate as a separate entity and we will DEFINITELY sell
chips to other companies. C-Cube is in business to sell chips in volume.

Why would the company want to get into the encoder business to compete against
other encoder makers who also use C-Cube solutions? Does the company foresee
losing other encoder makers to LSI and IBM as a result of this move?

- We did not acquire DiviCom for its encoder business, we acquired them for
their settop design expertise and understanding of the end application.
DiviCom will operate separately so we will not compete with our customers.

- IBM and LSI as of yet do not have a broadcast encoder solution. We do not
expect our broadcast encoder customers to transition to IBM or LSI. We have
proactively contact all of our customers to give them the heads-up on this
announcement and they have been supportive
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