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Technology Stocks : Rambus (RMBS) - Eagle or Penguin -- Ignore unavailable to you. Want to Upgrade?

To: J_W who wrote (22095)	6/8/1999 6:36:00 PM
From: Dave B	Read Replies (2) \| Respond to of 93625

22095 Jim, I think the biggest fallacy in many of the Shorts arguments is that they seem to think that someone said that all of this is supposed to happen TODAY! That Rambus is going to appear in low-, mid-, and high-end systems right away. They've missed the fact that the plan has always been to rollout Rambus from higher end down to lower end systems over the next couple of years. They argue that low-end machines don't need Rambus, and in that respect, their argument is correct -- low-end systems today do not need RDRAM, and no one is going to put it in there. I look at it this way. Let's say any processor running at 550 to 600 MHz needs Rambus to run effectively (and, whatever the speed you want to pick, there is some speed where you need to use Rambus). Today that's only the newest, latest, most expensive processors in the newest, latest, most expensive computers. Next year, when the high-end processors are running at 900Mhz, a 600Mhz system is only going to cost you $1500. And in 2001, the Celeron will probably be running at 600Mhz (I'm just guessing -- I haven't seen the roadmap) and Celeron systems will need RDRAM. As Tom Warren stated, Intel is simply trying to make sure that the memory is not the bottleneck. So while low-end systems today don't need Rambus, the low-end systems in 2001 will. The second biggest fallacy is that the price of RDRAM won't come down. The articles from 1996 show that this was the same concern about SDRAM and, surprise!, SDRAM came down in price. Any new hardware product starts off expensive, then comes down the production learning curve. In some ways, RDRAM will always be more expensive (it does require more silicon than simple SDRAM) and in others it will be cheaper (lower pin counts, etc.). They just can't think long term. Dave