WDC/Sandisk Corporation Message Board

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Technology Stocks : WDC/Sandisk Corporation

WDC 150.21

+8.7%

Oct 31 9:30 AM EST

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To: Sam who wrote (5808)	5/26/1999 1:27:00 PM
From: Ausdauer	Read Replies (2) of 60323

Sam, We have let some air out of the balloon during the low volume days where the stock can give back ground with little trading volume. It seems to work in our favor as volume picks up, especially after announcements like today. Include Lucent Technologies in the list of major industry players who are endorsing SanDisk. Dr. Harari cherishes these types of deals and I think that it cannot go unnoticed. I also believe that you could never put a price tag on this type of exposure. CompactFlash is becoming firmly ingrained in several of the megamarkets Dr. Harari has targeted. With each announcement the switching cost for OEM's (and also consumers) starts to go up. Sam, regarding your comments about ASP's and upcoming quarters I think I have an improved perception on how it may play out. The *value chain* (in which SanDisk is a major link) always ends at the level of the consumer purchasing into the technology, whether this be a retail market like digital cameras, PDA's and mp3 players or a corporate purchasing such as enterprise software or a company network. The advantage that SanDisk has in this value chain is that megapixel digital cameras are now under $400 and CF can be purchased for as little as $2.50 per MB. By Christmas expect to see megapixel cameras pushing the $300 price point and CF card prices below $2.00 per MB. At that juncture we may see a massive market interest which will really brings out the efficiencies of scale that Eli and his team have crafted. Also, recall that royalty arrangements for CF card assembly, should they materialize, could allow SanDisk to feed off both ends of this value chain. That is to say, at the level of manufacturing based on proprietary advantages and at the consumer level based on established retail channels. This would be the best of both worlds. Keep your seatbelt fastened, Sam. Ausdauer ($29 7/8)

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