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Technology Stocks : WDC/Sandisk Corporation

WDC 181.95

+7.3%

3:59 PM EST

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To: Steve 667 who wrote (3388)	6/25/1998 10:49:00 PM
From: Ausdauer	Read Replies (2) of 60323

Craig, I think we should add SSTI (Silicon Storage) to the list as this company was the subject of a recent post on this thread. Most of these companies are so-called "package assemblers" who get the flash chip and the controller and make their own CF device by the CFA standards. They apparently do not pay revenues except those hidden in the raw flash chip costs. Other companies simply purchase finished product and resell it with their private label, perhaps because they don't have the know how or manpower to worry about production of each item in their diverse product line. Most of these companies also sell standard memory, flash cards and SmartMedia for example. I guess anyone with adequate technical training can start up their own CF production line and simply adhere to CFA guidelines. There has to be a simple common recipe. But, there also has to be some recognition of the intellectual energy that went into developing CompactFlash. This seems to be the basis of the Lexar suit. Whether there is reverse engineering at play or just plain and outright patent infringement is unclear to me. The key is not only making the CF card, but including the essentials ingredients for disc drive emulation which Dr. Harari apparently invented some time ago. Lexar has made advances in the controller which reads and writes the image files onto the card, but the basic structure of the card still has to exploit the emulation function in order to succeed as a plug-and -play device universally recognized by devices with PCMCIA or CF slots. The future of the stock in the near term hangs in the balance of the litigation proceedings. CompactFlash is going to blossom regardless of who is making the chips. It is just a matter of time. Has SNDK positioned itself correctly. I thinks so. Unfortunately, nobody can predict the outcome the infringement suit. Only time will tell. In the mean time the market is having a great time sending the stock price up and down in great swings.

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