Shareholder Meeting: Forwarded to me from someone on AOL,
(thanks BC)
Subj: Re: Shareholder Meeting
Date: Tue, 22 Apr 1997 19:32:42 EST
From: DWMeharry (AOL)
Just got back from the shareholder meeting. Very upbeat presentation by Alex
and some excellent questions from the floor. Not much new information that
hasn't already been discussed here. Though a couple of interesting points:
1. This year and next year will be critical for the company as the large
Consumer Electronics and Communications companies make decisions regarding
which DVD chips to use. This is the "Battle of the Platform Standard." Once
Cube has its chips in a particular family of boxes, that is most likely where
they will stay. It's too hard and expensive for the parties to switch
between different chip makers. So far, Cube is looking good in this
area.
2. There is no inventory problem. There is no inventory problem. There is
no inventory problem. At present (and this is short term) the biggest
problem in this market is the available supply of loaders (not a Cube
product) which will no doubt fix it self soon. The demand for VCD chips is
huge. In 1996, they saw seasonal changes in the market. That market has now
grown to the point where they are not seeing seasonal fluctuations like they
did last year. For example, Chinese New Year is in February. Last year,
demand dropped off (for awhile) after February then picked up again in
August. This year, demand continued to pick up after February. And the
CL680 is turning out to be a very popular product with the VCD makers.
3. On Intel.... the company is always watching what Intel is doing. But
Alex made the good point that Intel's focus in mainly on the PC market and
not consumer electronics and video communications markets which is where
Cube is at. So, until that changes, they really don't compete in the same
markets (except maybe minimally).
4. Alex demostrated a DVD reference design using that Twister movie. Very
cool. I've seen it before, but hadn't seen a very good demo. These things
are so advanced, they make VCR tapes look like stone tools. If you haven't
seen one, I highly recommend it. Make whoever is doing the demo, show you
the slow motion, freeze frame, step frame, and Dolby Surround Sound features.
5. Recordable DVD boxes will be a reality within 2 years. They will of
course require real time encoding technology. I actually viewed a PC based
real time video capture and editing set-up over at the Divicom building --
and it works great.
6. Other markets for VCD MPEG 1 products are growing; but not as fast as
China. These markets include India, Eastern Europe, Indonesia, other Pacific
Rim countrys and South America.
7. On ESST. A very aggressive and able competitor which introduced a
comparable product (comparable to the CL484) at a much lower price during Q4
96. By Q1, Cube has responded to this challenge and now won back it's
customers and introduced a next generation chip (CL680) which will
effectively cut costs for customers along with allowing them to add features.
8. During the presentations, I noticed a Toshiba DVD player pictured in one
of the slides. Also, went accross the street and looked in on the Divicom
display. Lots of Sony boxes there.
9. Last, I wish I had a picture of the look on Alex's face, when I mentioned
Herb Greenburg to him. It was priceless.
Cheers,
DWMeharry
PS: This is copyrighted by me. If your name is Herb Greenburg, you may not
quote me or copy any of my writings here without my express written consent.
Anyone else, feel free.
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