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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Uncle Frank who wrote (8271)	10/14/1999 12:22:00 AM
From: John Stichnoth	Read Replies (2) \| Respond to of 54805

I think I didn't state my point very well. In fact, I think it changed slightly as I wrote the post (:o)). I am not saying that sandisk is a gorilla. Let me try to do better: 1. The non-volatile memory segment is growing in leaps and bounds. 2. Its use in various components themselves represent discontinuous innovations. Examples: Digital Cameras (of course), wireless portable internet devices. 3. The players in this market all are putting forth proprietary versions. One may arrive as a gorilla in the segment. And then, specific to sandisk--A number of events have occurred since June, including continued ramp-up in sales and growth in their value chain, as their product has been built into more and more appliances, and now the tie-up with Toshiba (which the market is frowning upon). I'm thinking specifically of Rule 3 (p 166): "Buy a basket comprising all the gorilla candidates--usually at least two, sometimes three, and normally no more than four companies." There are two Questions: 1. Is or will the non-volatile memory segment be large enough to contain a gorilla? 2. Is sandisk a possible leader and/or dominator of this segment? My answer to each question is, Yes. Therefore, I will hold sandisk lightly, not based on price but based on their position in the market. Best, JS PS--I'd also add one more attribute of a gorilla that Mr. Moore ignores--the leader of the emerging gorilla is always brilliant and admired (Gates, Tom Watson, Ellison, Chambers, Seibel, Jacobs). Dr. Eli seems to be such a person. Of course being brilliant is no guarantee of gorilladom. Just ask Steve Jobs.