WDC/Sandisk Corporation Message Board

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Technology Stocks : WDC/Sandisk Corporation

WDC 157.75

+1.5%

Nov 26 3:59 PM EST

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To: Ausdauer who wrote (15282)	10/3/2000 9:55:46 AM
From: Road Walker	Read Replies (1) of 60323

Aus, re: "It seems like SanDisk is rubbing shoulders with the big boys." Random thoughts on that. In pure manufacturing prowess, it seems like SanDisk would have a hard time competing with the likes of Hitachi and Toshiba when flash card volumes increase. The IP royalty revenue is more comforting in that it isn't based on gross margins, larger fabs will have economies of scale and lower COGS. Also, when the first down cycle hits in CF, royalties gross margin will not suffer as much as actual product sales gross margins, because royalties don't have the cost basis. It still seems logical to me that SanDisk will be bought out by a larger competitor as CF grows as a category. The company just seems like too small a fish to swim with these sharks. SanDisk really needs to establish a brand presence and preference through marketing, that would be almost as valuable as it's IP if they were to be bought out. SanDisk seems to be cutting good deals with these guys. I sure wish I could see the details, where the Devil resides. John

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