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Technology Stocks : WDC/Sandisk Corporation
WDC 181.54+1.1%Dec 26 9:30 AM EST

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To: JesseK who wrote (10249)4/10/2000 9:58:00 AM
From: Ausdauer   of 60323
 
I hope everyone had the chance to read my post regarding Simple Technologies.

Message 13369885

In my quest to further my knowledge of the CompactFlash market I also contacted several companies last week by e-mail.

I got the following reply from Delkin Devices...

"We manufacture our own CompactFlash. Our manufacturing is done in San Diego, CA. We use Hitachi brand Flash. We are unaffected by the lawsuit because we have no connections whatsoever with Lexar, and we pay royalties for the portion of our product that uses SanDisk patented technology. Feel
free to contact us again if this does not answer your questions.


COMMENT: The question that remains for me is what exactly this "portion" of the Hitachi flash chip is licensed from SanDisk and whether CF assembly patents are included in this royalty payment. Hitachi uses a different cell architecture (AND) and also manufactures their own microcontroller. The royalty payments to SanDisk may cover such features as cell architecture, configuration of memory arrays, block writing and erasing, detection of cell fatique and wear leveling and not have anything at all to do with CF assembly. I think it is impossible to know exactly what is recognized and unrecognized at this point.
_____________________________________________________________________________

I also e-mailed SST asking where their cards were sold...

"SST does not supply CF cards directly to the retail market, we supply to large OEMs and private labels. Please go to our web site, www.ssti.com, and you will find a list of our approved distributors. Please contact your local SST distributor to purchase small quantity CF cards. Another very good vendor that would satisfy your CF requirements is Kingston Technology, www.kingston.com, call them directly (800)337-8410.

COMMENT: I am happy that SST has negotiated successfully with SanDisk w/r/t CompactFlash assembly. This little company is similar to SanDisk in that they are struggling against industry giants, have an IP that is licensed by some of the larger players in the semiconductor field, and are currently fabless. Had I realized that they address a market segment not currently served by SanDisk I would have never sold my shares last Summer. I was fortunate to have been able to buy SSTI at only $1.75/share, but did not have the knowledge at hand to know that their book of business was based primarily embedded applications such as PC Bios and smaller, low density, industrial flash memory applications for the telecommunications (handset) industry. The fact that they have no control over their chip supply could spell trouble down the road for them as it is unlikely they will survive on current licensing revenues alone.

Ausdauer
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