Applied Materials No-Politics Thread (AMAT) Message Board

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Technology Stocks : Applied Materials No-Politics Thread (AMAT)

AMAT 256.41

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Dec 19 9:30 AM EST

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To: robert b furman who wrote (9910)	5/21/2004 8:54:08 AM
From: Bookdon	Read Replies (2) of 25522

I am a retired AMAT sales manager. "Early adapters" (Intel-IBM)only care about specs, so price is VERY secondary. AMAT sets a very profitable price (but invests a lot of engineering effort to make sure that the specs are met). The next wave of buyers only cares about delivery date(need to play "catch up" with Intel-IBM), so they pay a high price, too. The main wave of buyers(and now there is substantial direct competition to the AMAT tool)cares about price, so AMAT will make deals (but the learning curve has reduced the cost of manufacture, so margins are still pretty good). The AMAT key (as is that of Intel)is to get there with the leading edge product first, and then play with margins and the learning curve to maintain profitability.

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