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Technology Stocks : Creative Labs (CREAF)
CREAF 0.4480.0%Dec 18 4:00 PM EST

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To: Fred Fahmy who wrote (6591)12/6/1997 12:22:00 AM
From: Douglas V. Fant  Read Replies (3) of 13925
 
Fred, Good to see you back around! I am sitting here studying CREAF's Annual Report. I am studying their latest initiative entitled Building the Coolest PC".

Right now as best I can tell, CREAF is strong in sales of multimedia add-ons to system integrators and value added resellers of PC's. However as best I can tell CREAF is not big in selling multimedia kits to OEM's.

If you look at CREAF's sales the audio and video/communication portions of the business have grown over the last three years as a percentage of CREAF's total business, while the multimedia kit portion of the business has shrunk partly because of their withdrawal from manufacture of CD-ROM's.

Suddenly the reason for all of CREAF's recent strategic moves become clear when you look at the rationale behind the "Building the Coolest PC" campaign- and that is to sell branded multimedia components as a complete kit to OEM's.

Wham! There is the reason for the purchase of Cambridge Soundworks.

Wham! There is the reason to form a strategic alliance with 3DFX and ship its Graphics Blaster Exxtreme Video cards/Chipsets with the lethal Voodoo2 Chipsets, in tandem no less.

Wham! There is the reason for the development of the EMU-8008 audio controller chip with PCI bus mastering capabilities.

CREAF has pulled together a truly top of the line, lethal, first class combination of multimedia components and is going to seek deals with OEM's for the whole kits.

In this fashion CREAF could have a serious presence in all three major channels of distribution, sytems integrators, resellers, and OEM's- a very rational businesss strategy.

Now I am willing to bet that the "industry-wowing partnerships", if they click will be selling these total multimedia kits to OEM's.... That is some potentially serious business increase- keep your fingers crossed- CREAF is doing well already but OEM deals could really build product demand- and the good news is that the various components going into the total package are of a very high quality....

All of the above is from CREAF's Annual Report....

Sincerely,

Doug F.
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