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

To: Uncle Frank who wrote (26414)	6/16/2000 1:10:00 AM
From: Dr. Id	Read Replies (2) \| Respond to of 54805

The whole Rambus story... (Seems like Toshiba thinks that there's something to Rambus' suit against Hitachi..) Toshiba Signs Patent License Agreement With Rambus For SDRAM & DDR SDRAM Memory and Controllers Mountain View, California. -- June 15, 2000 -- Toshiba Corporation and Rambus Inc. (Nasdaq: RMBS) today signed a new patent license agreement for SDRAM, Double Data Rate (DDR) SDRAM, DDR FCRAM memory and Controllers that directly interface with these types of memory. Toshiba has been developing, manufacturing and selling Rambus compatible IC's since 1990. The new agreement covers patents for fundamental aspects of high-speed memory interfaces invented by Rambus, which are currently being implemented in SDRAM, DDR SDRAM and DDR FCRAM memory and controllers which directly interface with these types of memory. Under the licensing agreement, the royalty rates for DDR SDRAM and the controllers, which directly interface with DDR SDRAM, are greater than the RDRAM compatible rates. The agreement also includes royalties for SDRAM and for controllers that directly interface with SDRAM, as well as a license fee for the entire agreement. "This agreement ensures that Toshiba has rights to these important Rambus patents which are necessary to continue providing our customers with their choice of memory and logic products," said Yasuo Morimoto, president and CEO, Toshiba Corporation Semiconductor Company. "Toshiba will continue to be a leader in providing RDRAMs and Rambus-compatible logic products." "We have had a long and mutually beneficial relationship with Toshiba. Rambus develops and licenses IP - our objective is to produce innovations that will benefit the semiconductor and systems industries, and by licensing these innovations to generate a return on investment to our shareholders," said Geoff Tate, Rambus' chief executive officer. "We believe our Rambus memory interface is the best solution for the majority of the market. Developing and marketing the Rambus memory interface has been and remains our top priority. But we are willing to license our IP for other memory interface solutions as well." Rambus Inc. is an intellectual property company that designs, develops and licenses high-bandwidth chip-connection technologies which enable semiconductor memory devices to keep pace with faster generations of processors and controllers. To date, these efforts have resulted in more than 95 U.S. and foreign patents issued to Rambus. Rambus has licensed its technology to over 30 semiconductor companies for the development, manufacture and sale of Rambus-compatible ICs. Providers of Rambus-based integrated circuits include the world's leading DRAM, ASIC, controller and microprocessor manufacturers. There are more than 60 Rambus based systems shipping today, including Dell, Compaq, Hewlett-Packard, and IBM PCs and workstations and the Sony PlayStation(r)2 video game system. More information on Rambus Inc. and its high bandwidth technologies is available at rambus.com Rambus and RDRAM are registered trademarks of Rambus Inc. ** Note: Rambus Inc. will host an Investor Relations Conference Call, Friday, June 16, 2000 at 6:00AM PDT/9:00AM ET

To: Uncle Frank who wrote (26414)	6/16/2000 4:03:00 AM
From: Jacob Snyder	Respond to of 54805

AFFX: future gorilla? Business Summary (from S&P): Affymetrix (AFFX), a leader in the field of DNA chip technology, intends to establish its GeneChip system as the platform of choice for acquiring, analyzing and managing complex genetic information in order to improve the diagnosis, monitoring and treatment of disease. It began commercial sales of the GeneChip system for research use in April 1996, and currently sells products to pharmaceutical and biotechnology companies, academic research centers, and clinical reference laboratories. AFFX's GeneChip probe array technology and systems integrate semiconductor fabrication techniques, solid phase chemistry, molecular biology, software and robotics. The system consists of several integrated components: disposable DNA probe arrays containing gene sequences on a chip housed in a cartridge, reagents for use with probe arrays, instruments to process probe arrays, and software to analyze and manage genetic information. The company is based in Santa Clara, CA, and has 519 employees. Market cap: 4.7B. Gorilla potential: 1. mass market potential: Today, AFFX sells to research labs. When this technology moves to clinical labs, it will have a market several orders of magnitude larger, to sell into. This technology can be used to: follow the progress of a disease, assess the odds of getting a disease in the future, assess response to treatment. Most diseases, including all cancers, and most chronic illnesses, have a genetic component. That is, certain genes are turned on and off during the disease process, and inheritence strongly influences the odds of getting the disease. The technology AFFX is developing measures this. This can only be done today at tremendous cost, and the results take weeks to come back. AFFX's postage-stamp-size chips hold up to 8000 gene probes, and can give results the same day. 2. proprietary open architecture/ownership of crucial intellectual property: AFFX has licensed its technology to most of the large drug companies. They won a crucial court battle over patents against INCY in 9/99. Anyone developing any DNA microassay must pay AFFX royalties. However, there are potential competitors (Motorola, Celera, Agilent), and the turf wars in the courts are on-going. None of the other companies are anywhere close to AFFX in terms of developing the technology, market share, or ownership of crucial court-tested patents. 3. switching costs: The chips, and all the related scanners, and the software to manage the vast amount of data, are not compatible with other systems. 4. value chain: AFFX has the beginnings of a value chain, as they have licensed the technology to most of the major drug companies, for their genomics research. No value chain exists for clinical applications yet. 5. Tornado potential: revenues (in million $) for years from 1995 on are: 5,12,20,52,97 (actual in 1999), and 185 (estimate for 2000). Revenues for the last quarter were 40 million, compared with 20 million a year earlier. So, the pattern is a rough doubling every 12 months. This was achieved just selling to research labs, academic centers, biotech companies. They dominate that narrow niche. The real mass market hasn't been entered. I'm guessing the Bowling Alley stage is in 2002-2003. 6. Profits: none yet. However, all 8 of the analysts who follow the stock say the company will become profitable in 2001 (EPS range 1.23-0.43). It is not unreasonable to suppose that profits will double year-on-year (along with sales), and then accelerate as the tornado starts. 7. valuation: all I can say is, the stock chart looks a lot like QCOM's: 16 in 8/98. 327 in February 2000. 171 now. P/S is 40.