Tench: You seem to have been quoted in this article....
<<<"Perhaps Intel is figuring that the whole world doesn't need to move to [Rambus-designed] RAM as quickly as possible," says one message posted by "Tenchusatsu." "I still think it will happen, just not as soon as I originally thought.">>>
Intel Inches Away From Rambus
By Marcy Burstiner
Staff Reporter
4/23/99 3:14 PM ET
SAN FRANCISCO -- Shares of memory-chip designer Rambus
(RMBS:Nasdaq) plummeted to their lowest point since Oct. 8 today
after Intel (INTC:Nasdaq) said on Thursday that it would support
alternative chipsets.
At an analyst meeting held Thursday, Intel executive Paul Otellini said
the chipmaker would come out with chipsets this year for non-Rambus
synchronous DRAMs. This is a major blow for Rambus, since Intel
was one of the strongest and earliest backers of its designs.
Memory-chip makers have balked at adopting Rambus designs
because of the hefty royalties they would have to pay to the company.
Recently, as memory-chip makers began looking for alternatives to
Rambus, Intel had issued statements supporting the company's
designs. Many institutional and individual Rambus investors held on,
waiting to see if Intel would drop its support of the company.
Now Intel seems to be tiptoeing away.
After opening at 59 1/8 today, Rambus stock dropped 12.8% to 51
1/2, a half-point below its Oct. 8 closing price, in heavy volume. By
midafternoon today, it had climbed up from its session lows to hover
around 55 1/8, down 2 1/2.
On Thursday, Credit Suisse First Boston analyst Charles Glavin said
the memory-chip industry is expecting a new Intel chipset (currently
called 810E) in the next quarter that will support PC-133 DRAMs, a
stopgap alternative to the Rambus design, for Intel's entire line of
chips, from the low-cost Celeron to the high-priced Xeon.
Shares of Rambus hit an all-time high of 109 1/2 on Jan. 11, but fell
after lead underwriter Morgan Stanley Dean Witter downgraded them
to neutral based on their high valuation. Three weeks later, Morgan
Stanley upgraded the company back to outperform to reassure
investors that rumors that Intel would delay shipments of
Rambus-designed chipsets were unfounded.
But the speculation continued to dog the company. Micron
(MU:NYSE) CEO Steve Appleton went out of his way on his
company's March conference call to cast doubts on whether Rambus
chipsets would be out this year at all.
In recent postings on Internet message boards, Rambus shareholders
have vented their frustrations about the latest developments.
"Perhaps Intel is figuring that the whole world doesn't need to move to
[Rambus-designed] RAM as quickly as possible," says one message
posted by "Tenchusatsu." "I still think it will happen, just not as soon
as I originally thought."
Another poster suggests that Rambus might now have to compete on
the merits of its technology rather than its Intel sponsorship. "For what
it's worth, I'm taking [Rambus] off my screen," says the message,
signed "Robert Jacobs." "I plan to tuck my 7,000 shares that I bought
in the '70s into bed for a nap ... and rouse them two years from now to
see whether there should be some sales."
One institutional fund manager who asked to remain anonymous says
she bailed out of Rambus back in January at the high. "We felt the
stock price had reached a value for revenue that we had not expected
for several years out," she says.
Srini.
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