Sunny, thank you for the reply. Every exchange helps clarify my understanding of CREE. However, I have to disagree with some of your statements.
IMO, the bowling alley does not involve knocking down different market niches using different products. It involves knocking down multiple market niches with a single whole product, or a single whole product that is gradually modified and perfected as you move from niche to niche in search of the mass market. Blue LEDs are a single whole product that, I believe, is in the bowling alley and has the potential to spawn a tornado.
I agree with you that other CREE applications, like RF amplifiers, have a lot of potential and, in fact, have the potential to spawn a whole separate tornado. The same with the blue laser. However, these other products are not yet whole or across the chasm.
The way I look at it, and I think most G&Kers look at it, is companies with significant IPR have the potential to spawn multiple tornadoes. CSCO and MSFT are such companies. I agree with you that CREE has a lot of potential beyond blue LEDs. I don't mean to dismiss these other potentials, and any investor in CREE should certainly be aware that there's a lot more potential to CREE than just blue LEDs. However, IMO, these other potentials are not far enough along to be seriously considered by G&Kers until, at a minimum, they are across the chasm.
Eric |
