Premises for My RMBS Investment and Current FUD
Speaking about alleged ignorance of the author,
could you point to a single line in the article
which is incorrect, or misinforms readers?
The main problem is that the author quotes from analysts on only one side of the issue. In addition, those analysts' conclusions don't match the facts (see explanation below).
Your response does not contain anything about
the missing side of the analysis. Could you
summarize for us the missing part?
Actually, I believe I did mention the missing part, but I'll try to be more clear below.
The author states:
But most analysts agree that if the latest ruling stands it will put an end to investor hopes that Rambus will be able to derive substantial income by cornering the market on critical memory chip technology patents. Rambus had hoped to use royalty payments from patents on two types of currently available memory chips not only to generate revenues but also as a lever to drive manufacturers toward Rambus' own proprietary flavor of next-generation memory chips, called RDRAM.
First of all, I seriously doubt that the author's statement fairly represents the view of "most analysts." The "missing piece," as I pointed out in my earlier post, is that the recent case (if it actually stands) does not by any means obviate RBMS strong patent position with regard to RDRAM, and RDRAM is where they expect to get the lion's share of their licensing revenue in the future. If you can you point me any information that demonstrates that RMBS RDRAM patent claims are in jeopardy as a result of this ruling (or any other ruling in their patent litigation), I would be very interested in seeing it. I don't say that facetiously, either. My decision to invest in RMBS is based on the potential that I see in RDRAM, and so far I don't see that their RDRAM patent claims are at risk here. (Their other patents are great if they hold up, but I consider them to be merely "icing on the cake.")
Later the author quotes another analyst:
"I don't know what the reasons could be for the buyers," says Brian Matas, vice president at IC Insights Inc., a semiconductor market research firm based in Scottsdale, Arizona. "There's no reason to look at this company and believe its got a future that would be beneficial to investors.
IMHO, there is an extremely good reason: RDRAM. My investment in RMBS is based upon the following premises:
1) RDRAM will eventually win out over DDR because it has superior characteristics which will become more apparent (and, hence, compelling) as CPU speeds increase.
2) RMBS has patents that allow them to get a royalty on all RDRAM sold.
The information I've seen in the last couple of months seems to indicate that RDRAM is already gaining momentum, and I've seen nothing in the recent news that demonstrates that RMBS' IP claims on RDRAM are in jeopardy. Hence, I conclude that RMBS is a more compelling investment now than it was even a month ago, since the price is now depressed. Again, if you can point me to any credible data that shows that either premise above is false or doubtful, I'd very much like to see it (seriously).
My intention is not to engage in an argument, I really just want to know the facts, since that's the key to making money here. Unfortunately, investment journalists and analysts' public statements (for the most part anyway), are not a reliable way to ascertain the truth. |
