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To: Mike Buckley who wrote (14692)	1/9/2000 1:17:00 PM
From: FLSTF97	Read Replies (1) \| Respond to of 54805

Mike I think you are only partially correct in this understanding. You probably need to think of Cree as 3 entities at the moment(I'm focusing on the fab part and ignoring the fake diamond business). First it is a raw material supplier: they sell SiC wafers which is analogous to Wacker supplying raw wafers to Intel. They sell this to essentially their competitors, and research institutions. Second: they have a "fab" (a la Intel) which they use to build devices out of the raw SiC wafers (which they make internally), LED's being the predominant ones at this point. I like your analogy that Intel imparts its software onto the raw material and find that to be a fundamentally correct impression. Basically Cree is doing the same thing but their architecture (I hesitate to call it "software" at this juncture)is the most simplistic solid state device (architecturally speaking) that one can make. Contrast Cree's device with Intel's. Each Cree device contains one architectural element: a diode. Each Intel device probably has over 100K of these diodes elements not to mention millions of more sophisticated architectural elements. Ergo the Intel "software" is more impressive than Cree's at this time. To continue the software analogy: Intel writes its software with Silicon: Cree with SiC (kind of a Fortran vs C++ comparison). C++ may be better suited for some applications, indeed in this situation it would be impossible to write the software with "Fortran" Third: It is a research institute that is expanding the knowledge base surrounding devices built into/with SiC. Does that help or confuse? Fatboy