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Technology Stocks : C-Cube

CUBE 36.52

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Dec 12 9:30 AM EST

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To: VINTHO who wrote (37941)	12/28/1998 5:01:00 PM
From: DiViT	Read Replies (2) of 50808

CREATIVE LABS IRISH SUCCESS 12/21/98 Inside Multimedia (c) 1998 Phillips Business Information, Inc. One of the main sponsors of our DVD Summit in Ireland next March will be Creative Labs. It is a happy coincidence because DVD is proving to be a major money-spinner for Creative Labs in Ireland. Its Encore DVD upgrade kit was the first and it has captured the market, much as the Sound Blaster board captured the market at the beginning of the decade. The problem now is producing enough DVD kits to meet the demand. This presently exceeds 100,000 a month and the Dublin factory can only get the components for 50,000 a month. Mike Weatherley, sales supremo of the European operation admits that they didn't expect demand to ramp up so quickly. The shortage of critical components has been caused by a worldwide stampede to put DVD-ROM drives in new machines. Manufacturers would normally go direct to the component manufacturers for their OEM needs. This time they are banging on Creative's door with requests for as many as 50,000 units a month. Amazing. Creative offers three versions of their upgrade kit of which only one contains the MPEG -2 decoder card. Interestingly the latter (the most expensive) is selling three times the quantity of the others. In theory if you have a fast Pentium and Windows 98 you don't need the decoder card, Windows can do it in software. In practise it aint so simple. For a start you need a graphics card with motion assist which takes some of the strain off the CPU. Even then there are problems. We are hearing reports that unencrypted video streams can be decoded but CSS encryption causes problems for software decode. The Creative Labs factory outside Dublin is now working flat out, three shifts, 24 hours a day. It employs 350 people and serves the whole of Europe. Dublin is becoming the boom town of Europe and recruitment is becoming a nightmare. Poaching is rife, some of Creative's people get calls every day from headhunters. IM analysis This unexpected boom in demand for DVD-ROM upgrade kits is not that easy to explain. The number of DVD-ROM titles as yet can be counted on the fingers of one hand. Few games manufacturers are offering DVD versions of their games. DVD-Video titles are not easily viewed on a PC, although the kit includes extension cables for TV connection. Perhaps some people are using them for porn. Certainly most people are choosing the version with an MPEG -decoder card. Whatever the reason the consumer is aware that DVD-ROM is the future and they have little to lose in replacing their CD-ROM drive now rather than later. Finally let us not forget that better audio is a powerful excuse for upgrade to DVD. The PC stores are filling with 4 and 5-speaker surround sound kits at remarkably cheap prices. The only explanation for this is the arrival of DVD with its Dolby Digital and Pro-Logic tracks.

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