Geek,
Good idea, here's to boiling it down...
I don't have all the info in front of me at the moment,
but to give you a quick response, here goes...
FCSE follow-up
Summary:
WHAT: RGB to NTSC video converters (encoders)--see below
WHY NO COMPETITION: no one can make good ones at anywhere
close to the price.
WHAT CUSTOMERS: through TV, VCR, camcorder, or editing systems
purchases, encoders can be built into any of these.
a) anyone with a computer who wants to view or show or demonstrate
computer images on video, for example video conferencing, demos,
many others
b) anyone who buys a set top box. The encoder would probably be
built into it.
c) anyone who wants to edit video at home
WHAT NUMBERS? If only we had a time machine.;)
Seriously, I can only speculate here.
For c) above, there could be an unexpectedly large market. How many Hi-8 camcorders are sold each year? I bet that there is large undiscovered pent up demand for personal, basic, user friendly digital video editing. Price: $2000 dropping to $1000 in 2 years. At that price, half million units/year easy. 0.5 mil x $1000/unit = 500mil
Not small change. This will happen, if not by 98, then give it another year.
WHY?
Focus is designing a prosumer video editing system now. Not just the encoder, but the whole thing. Big bucks here. People are bored as video consumers. They will move up the cultural feeding chain into production. Big bucks for someone who can deliver "easy" and "cheap".
I gave 30mil units as a wild guess for a) and b) combined over next three years. More conservatively, 5 mil encoders/year by 1998.
5 x $40 per encoder = $200mil minimum.
WHY? Maybe 3 mil set top boxes and 2 mil "computer-ready" TVs, like the Zeniths. Lets say you have a portable and want to show some hot multimedia or game to someone else. It's a 100x more impressive to display it on a TV at even 19" than on the portable. What if you want to record video from off your computer or from video off the net?
You need something with an encodr in it.
I am happy with potential revenues of $700 million by 1999.
At 2xsales, the stock would have a market cap of 1.4 billion
Lets see, from $20mil cap today, that's 70 times or a 70 bagger.
Well, sorry guess I better find the 70 bagger thread! ;)
Of course there would be share dilution, but how many companies growing that fast sell at 2xsales? |
