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

To: grok who wrote (28897)	9/7/1999 4:45:00 PM
From: Tony Viola	Read Replies (1) \| Respond to of 93625

KZ, one of the chips in the PS-II is from LSI Logic, who also had chips in PS-I. LSI is experienced in these things, FWIW. Why do you say Toshiba isn't? Sony I agree about, but I don't think they did any of the chips, did they? Tony

To: grok who wrote (28897)	9/8/1999 1:55:00 AM
From: Bilow	Respond to of 93625

Hi KZNerd; About that Sony playstation. You got me convinced that Sony PSII is in big trouble. I haven't followed the product, I had no idea it was going to cost so much. In fact, most of engineering is about controlling costs. (If it weren't, we'd probably be using those multi-GHz interfaces some of you guys figure are easy to design.) I worked for a couple of years at a company that made a virtual reality headset sold to the gamer community. The problem was that it used LCD panels that cost us $40 each, and the glasses took two of them. So right off, we had a cost of goods of $80, before anything else. The rest of the stuff brought the parts, packaging and labor up to around $110. As most of us know, that means that the company had to get something like $440 at the retail end in order to survive. This was a beautifully engineered product. The company got great support from the software game companies. It had head tracking, and you could play Quake straight out of the box, with the head tracking operational. (As you turned your head, the scenery changed with it.) It was a gorgeous product. But it wouldn't sell at $500 each, so as inventory piled up, they dropped the price to $300. Still wouldn't sell. I thought that there was some mistakes in the way it was sold to game players, (marketing is way out of my ball park, though) but the basic fact is that game players will not spend more than about $100 on anything, no matter how cool it is. It is, after all, just a game. So the company went bankrupt. I guess I should mention that there had been some expectation that the (Japanese) suppliers of the LCD panels would cut us a volume discount, but that never did happen. It may be that the reduced pricing on LCDs now makes it possible to put together a cost effective LCD VR HMD. Getting back to the subject of rambus in PCs, rather than playstations, I was surprised to find that the Celeron only requires a 4-layer motherboard. This is the same layer count that was used back in the '286 days, and I was sure that it had gone up. This just goes to show how important cost of goods sold is. That multiplier of four to get to retail cost means that engineers of high volume products have to squeeze every penny out of designs. I'm sure it wasn't easy getting that Celeron down to four layers. And I'll bet those four layers don't have much in the way of impedance controlled traces, either. This is the essence of ease of manufacturing and design. And I bet that I could layout one of those 4 layer motherboards on the high end Orcad software. There has been some suggestion on this board, that INTC will be able to sell RMBS using something other than the traditional technique of supplying bang for the buck. There are two traditional customers for PCs. The ASPs on machines used at home has been dropping like a rock for the last two years. Those Celeron motherboards are INTC's reaction. The cheap end of the market is just not going to be able to afford rambus technology. And not just for the memory chip cost itself. The basic fact is that the consumer is primarily motivated by price, provided that the machine does what he needs it to do. The other traditional customer, is more sophisticated about computers, and will buy based on performance metrics, rather than just hype and clocking numbers. These guys are going to be a hard sell for rambus as well. -- Carl