Jay, looks like you're market timing to me. I think that $19 million a quarter in royalties, in a slump, during what is typically a crap quarter, is nothing to sneeze at. We're still at the beginning of the ramp-up of digital cameras and who knows what else that might use these cards. By holding off, you may get your much cheaper price...or you may not.
I see broadband as a huge driver for flash memory, and it is finally ramping up aggressively in North America - but we are still at the very beginning of this process, not only here but especially on a global basis. (The nice thing about having IP in flash is that the revenues can be tapped everywhere, whereas the telecom providers are usually limited geographically and have to put up huge investments to benefit.)
My assumption, and I may do ok even if I'm wildly wrong, is that SanDisk gets royalties from a lot of companies that matter.
I also think Lexar's days as an independent company are numbered, and that the territory they have claimed with their technology is likely to get run over by new SanDisk/Toshiba advances.
Anyway, things may get worse, but I'm not betting on it :)
JMO
Andre |
