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

To: tekboy who wrote (26837)	6/26/2000 6:09:00 PM
From: Mike Buckley	Read Replies (2) \| Respond to of 54805

tekboy, Sorry I was confused and at the same time caused more confusion. First I wrote that Rambus couldn't be a gorilla of any kind because there had been no torado. Then rel corrected me by reminding us that the SDRAM tornado had already taken place. That leaves me thinking that Rambus might already be the gorilla but I'd prefer to see more companies line up behind Toshiba and Hitachi before determining that Rambus's lock on SDRAM is so solid that the crown should be put on the head. How do we regard a gorilla born on Main Street? Good question. I think the best way to look at it is that it has the potential to be like Qualcomm and Cisco in that its value chain can foster more tornados in the various forms of DRAM. I'm not suggesting that it has the same revenue potential as Q or Cisco but I'm also not suggesting that it doesn't. I don't know enough about the market. I thought your skepticism related to something much more worrisome, which was that even with full capitulation on the part of the manufacturers a) the ensuing revenues wouldn't spiral upwards to the sky and b) the realistically predictable future revenue stream was already built in to the current price. That's important to determine. But I thought the discussion you and I were having was much more limited, focusing only on whether or not Rambus is a gorilla. There are definitely different kinds of gorillas with various degrees of power and ability to generate profits. And in my mind there's always the question of the stock price because I will never blindly accept that all gorillas are always undervalued until a discontinuous innovation unseats them. You also asked about communication chips. I don't know enough about them to have an opinion but since their market is practically everyone in the world, the market itself will be huge. How it gets divided is worth pondering, but I've always felt TXN would be huge on the strength of their DSPs alone. Now that we can add wireless stuff to their arsenal, they look to be a mighty King for a long time in that area. --Mike Buckley