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Technology Stocks : RAMBUS (Nasdaq: RMBS) - THE EAGLE

RMBS 99.28

+8.0%

Jan 2 9:30 AM EST

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To: richard surckla who wrote (170)	12/5/1999 11:00:00 PM
From: richard surckla	Read Replies (2) of 2039

One man's opinion by one of the better posters on Yahoo... Food for thought... ------------------------------------------------------- More things to think about by: fneww 12/5/1999 10:08 pm EST Msg: 31366 of 31369 Intel can purchase warrants for 1 mill shares of Rambus stock at $10 if it produces 20% of its chipsets which use RDRAMS in two conseq quarters but the right to these warrants expire on Jan 1 2001. If Intel is producing 30 mill CPU's per quarter, and if they produce the same # of chipsets then they've got to produce some 6 mill Rambus compatible chipsets per quarter to obtain these warrants. So Intel gives money to Samsung and Micron to buy production equip to produce enough RDRAM to populate these chipsets. You need some 8 to 16 RDRAM chips to produce a Rimm module to populate each chipset. That means for Intel to meet its goal some 70-75 mill RDRAM chips need to be produced per quarter beginning in July 2000, or about 25 mill per month. NEC says it will produce 1 mill per month and Samsung had projected 5 mill per month beginning in Jan before the Sept fiasco, and they would ramp up further as the year progressed. For Intel to get those warrants they need Micron to use the 500 mill they got from Intel to buy testers and probably a bucket full of .18 mu production equipment to make millions of RDRAM chips per month. Supposedly one needs to spend $10 mill to by testers to produce 1 mill RDRAMS pr month so if Micron is supposed to produce 10 mill RDRAMS per month they need $100 mill for testers, so Intels $500 mill also allows them to by $400 mill of other production equip. Hyundai is out of the game since they don't have the money to play so that is why they're gung ho for DDR. NEC and Toshiba are also resource constrained and since Samsung took only $100 mill from Intel one can only expect around 10 mill or so RDRAM from them per month by mid year. That means that Intel is depending on Micron to come through with enough production to populate their chipset target. Intel clearly would not want to be producing a DDR chipset to compete with Rambus since that would defeat their whole game plan and mostly waste the money they invested in Samsung and Micron. Bottom line of this discussion is that for Intel to succeed and for Rambus to begin an explosive upside move during the next six months, Samsung and Micron have to get with the program pronto. We know that Samsung is clearly on board. With Dell's leadership, if Compaq, HP and IBM additionally join the marketting campaign, Micron will likely be dragged kicking, screaming and laughing all the way to the bank into the fold and all of us Rambusile longs will begin foaming at mouth as we watch the stock price go parabolic. What a soap opera we will be witnessing in the next few months.

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