3Dfx is in for a tough time trying to win any major OEM contracts.
I currently have no position in TDFX. I did last year around the release of Voodoo2. Today, based on their Voodoo3 specs across the entire product line, 3Dfx will not win any major OEM contracts. Pursuing vertical integration with the purchase of STB will not help. Sure, STB has the OEM business relations, but 3Dfx/STB doesn't have the right product. In the face of intense competition from NVidia (TNT2), S3 (Savage 4), and ATI (Rage 128), 3Dfx's Voodoo3 falls flat. Remember, major OEMs have checklist features they must have to market their systems effectively to the unknowing public.
3Dfx will not be able to capitalize on STB's OEM relations with Voodoo3. If their nextgen product isn't released soon, I see TDFX trading down to $7 within 6 months as marketshare erodes and losses mount in subsequent quarters.
Marketeer |
