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Victoria & All, Some Encouraging News!
Research Alert - Sherwood Research In Pursuit of Ubiquitous Computing: Intel and National
Semiconductor
WELLESLEY, Mass., July 30 /PRNewswire/ -- Sherwood Research, Inc. today released a research alert concerning Intel and National Semiconductor's recent
acquisitions.
Situation:
Recent acquisition announcements from Intel (INTC) and National Semiconductor (NSM) have initiated what Sherwood Research identifies as a new trend that
will revolutionize personal computing. Intel announced the recent acquisition of Chips & Technologies (CHPS) for $420 million. Hot on the heels of the Intel
announcement, National Semiconductor proclaimed their own major acquisition of Cyrix Corp. for $544 million. These acquisitions position both companies to
incorporate into chipsets many of the discrete technologies found in today's PCs.
Both announcements will have a serious impact on investors, manufacturers, and personal computing end-users. The consequences of these two major deals reach
beyond the basic evolution of processor chip manufacturing.
Industry Opinion:
Long without direct competition, Intel has not rested on its laurels. In fact, the first visible phase of a strategic product expansion plan that targets the market for
less complicated full function end-user computing platform was implemented with the acquisition of Chips & Technologies earlier this week. This deal gives Intel a
remarkable advantage over its competitors. The CHPS acquisition allows Intel to increase the functionality of the processor packaging it sells. In particular, the
CHPS deal will allow Intel to add video and graphics capabilities to their processor packaging_
Investment Opinion:
Investors must bear in mind that with these acquisitions, both Intel and National Semiconductor are pursuing an aggressive paradigm shift for personal computing.
Predictions of slowing PC sales should not adversely influence Intel's revenues. The market opportunities provided by these ``all-in-one'' devices will dwarf any
revenue shortfall created by the cannibalization of the revenue derived from the current processor product line. Additionally, Intel's revenue will not be
significantly impacted since revenue protection will come as Intel's all-in-one systems solution usurps PC manufacturers' negotiating power (unless AMD jumps
into the communications components business)...
Intel, National Semiconductor, Dell, Compaq, Micron, and Gateway 2000 are all included in Sherwood Research's Millennium Technology Index. (See Below)
Millennium Index:
The Millennium Technology Index is comprised of companies that will capitalize on the vast, emerging market created by the convergence of the
computing/communications technologies and digital media. Utilizing information from The Sherwood Report, the winners and losers in the continuing battle for
corporate and consumer technology acquisitions will be identified and tracked within the Millennium Technology Index.
The full text of this Research Alert can be found on the World Wide Web at sherwoodonline.com
The Sherwood Report is also available on Gartner Group's @vantage (www.atvantage.com), an interactive environment offering high quality research and
analysis on the World Wide Web. |
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