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

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To: OpenMind who wrote (13555)2/17/1999 7:24:00 PM
From: Sun Tzu  Read Replies (1) of 13925
 
I agree that sound is very important to Creative. Unfortunately it seems that the management has forgotten this. Part of the reason I think is that the sound blaster is an old technology and there is very little growth in there left for Creative. Even worse, lower end competitors are biting at their share. Now if there was to be an audio revolution to happen for the PC industry, i.e. killer apps that required high end sound and fostered demand, then I can see a future for Creative in sound. As it stands, I think the best they can do is to maintain market share. I think this is the same conclusion as the management and that is why they are not pursuing sound aggressively.

Graphics is the next logical step for Creative as a multimedia company. Acquiring nVidia will put a ton of pressure on DIMD. Creative should squash DIMD if they can, and the easiest way is via graphics.

The other option before Creative is to develope a whole new line of products. Kind of like what DIMD did with Rio. Alternatively they can be active in developing (in cooperation with a bigger company like Sony) a new standard in entertainment and try to carve themself a niche in there. Trying to go after loud speakers and the like does not cut it IMO.

You may be right about the DVD part. If you know of a pure DVD play in the market, I'd be interested to know. Perhaps they would be a better buy.

regards,
Sun Tzu
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