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Technology Stocks : Rambus (RMBS) - Eagle or Penguin
RMBS 94.82+2.7%Nov 26 3:59 PM EST

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To: Dave B who wrote (29399)9/13/1999 8:22:00 PM
From: Dan3  Read Replies (1) of 93625
 
What Price?

You have to be able to discriminate between high/low costs, and high/low price. For a product to be a success, you need a low cost, and a high price - this allows you a profit.

Rambus needs to get the memory manufacturers to switch over to producing it, instead of the present SDRAM. It's expensive for them to do so, but some have been planning to do so anyway, because prices for SDRAM have been too low for them to make a profit.

Now SDRAM prices are up, but SDRAM costs are still low - so manufacturers can make lots of money with SDRAM, and therefore cannot be expected to switch over to rambus as quickly as before, if they will do it at all.

If rambus prices and SDRAM prices are the same, but SDRAM costs continue to stay at about half that of rambus, no one will bother manufacturing rambus, unless the price of rambus goes even higher than it is now.

Dan
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