Why CREAF? Good question. Will cheap sound on board continue? Probably. Does that mean better sound boards die? Probably not. Low end is a commodity. CREAF is looking to higher performance to stay out of the commodity business. This is a tact that they are taking with SBL. High-high end, with top margins. They are also doing this with graphics products- TNT, Banshee, Voodoo2. No more crappy Rendition or Permidia boards. High end gets the margins, and high end is in demand, as Voodoo and TDFX have shown.
There will constantly be demand for high end products. If you do not believe this, then GTW and DELL will likely be in trouble. They sell lots of computers, and love to load 'em to the gills with bells and whistles, and prop up the ASP as high as possible. And consumers like to buy them.
CREAF also has great distribution channels, the best brand name in computing audio, a great new line up of products, and as good a balance sheet as you could want, with a sick amount of cash.
CREAF does need to get the SBL line into OEMs though, and, if they could just suck it up a little and take the place of the Aureal cards in CPQs, they could generate nice revs and continue showing the world their dominance.
SBL will likely be the number one selling peripheral in the coming months, and this will generate a need for better speakers, which, of course, they will be happy to sell.
At 9ish a share, this is a deal of a lifetime, IMHO (said that at 10 also :)
JeffLins |
