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Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: drbailey who wrote (18318)	2/16/2000 10:42:00 AM
From: drbailey	Read Replies (1) \| Respond to of 27311

Some additional thoughts: Looks like I am the first one to get home and have a few minutes to share my impressions of the meeting. Until yesterday not much has been said about licensing the technology to other manufacturers. I don't believe any potential revenues from licensing are in the stock at present. Yet, the potential revenue from licensing is greater than from manufacturing. At the meeting a video was shown of the manufacturing process in NI. The equipment required to produce a battery is staggering. Not only would another company be required to develop the technology to produce Lipoly batteries which could compete with ours they would also have to develop the equipment to make them. Unless you have watched the equipment operating it is hard to visualize the challenge. Every step in the process has undergone extensive engineering, testing, failing, fixing, fine tuning, etc. The process is complicated, extremely expensive, and would take a long time to develop to the point it could produce at the level Valence is now achieving. If another company wants to be a part of this vast market what do you think they are going to do? Spend the tens of millions necessary to catch up with Valence? Or, go to Valence and negotiate a license? Lev showed a chart of the potential market for Lipoly batteries and it was a mountain. Larger than any battery previously developed. Mobile electronics are the future and the devices will be light, slick looking, with long run times, and, in many cases, disposable. If a manufacturer doesn't have to design in a canister battery they only have one place to go. Valence. If other battery manufacturers want a piece of the pie in the near future they have only one place to go. Valence. Lev was almost cocky when he talked about transitioning in becoming a licensing company rather than strictly a manufacturer. He said: "look what Qualcomm has done." Let the others have the headaches of meeting production schedules, keeping machinery operating, building factories, selling batteries. Valence is already an R&D company. Now they have proved their technology can be produced commercially. (I guess the jury hasn't quite returned on that one yet, but the verdict is predictable). Bellcore is in a position to profit from every Lipoly battery sold in the coming years. But, their technology is only half the pie. Valence has the other half with its ability to put the Bellcore technology into a workable battery. I'm not a numbers person but can't wait to see what numbers can be predicted when you put licensing into the mill. Should we be pumped? David