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

To: Zeev Hed who wrote (34995)	11/22/1999 10:20:00 AM
From: Ian@SI	Read Replies (1) \| Respond to of 93625

Zeev, I suspect that part of your expectations for a larger share of the DRAM market by RDRAM stem from RMBS itself through the Analyst community. I no longer believe that hype is anywhere close to reality. Significant growth in DRAM units have been the result of the rapid upsurge in "free" or nearly free PCs. I'd be very surprised if any of these devices ever comes with RDRAM. The addressable market for RDRAM is a shrinking niche (in $ or % of total units); and it certainly won't have that niche all to itself. And $2.7B of DDR SDRAM is equal to about $75-$100B worth of chips at the time of the RMBS IPO. Chip prices have dropped dramatically. I expect the pace of that decline to slow, perhaps even pause for several months until more capacity is brought online. But the fact remains that RMBS price reflects significantly more Royalty revenue expectations than it's ever likely to see. And the supporters of RMBS on this thread don't seem to have revised their revenue estimates to reflect DRAM pricing reality nor the reality of better priced, higher performance competitive products. As long as a sufficient number of them continue to believe the RMBS dream, the stock's price will hold, perhaps even climb. But sooner or later reality will set in, and there will be some severely deflated RMBS bulls. JMHO, Ian.