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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: hueyone who wrote (13476)	8/1/2000 2:16:17 PM
From: Ausdauer	Read Replies (1) \| Respond to of 60323

Huey, You really have got the gears churning in my brain. I wanted to respond to your inquiries as follows. ______________________________________________________________________________ The SSTI investment in Apacer is documented in an SSTI press release. A dollar figure is not attached. Again, I see two possible scenarios. Either SSTI views Apacer as a good long-term investment or the assembly deal requires SSTI to share some risk. Other scenarios may exist. This is different from SanDisk where they are able to manufacture/gather components and contract assembly with a major ECM like Celestica...no strings attached. SanDisk has invested instead in fab partners like UMC and Tower. These are long-term relationships which add to the stability of both companies. It is also a means of sharing risk. Today Apacer announced that SST (Silicon Storage Technology, Inc.)(Nasdaq: SSTI chart, msgs), a worldwide acclaimed Flash design and manufacturing company, has bought 10% of Apacer Technology Inc.'s stock. siliconinvestor.com ______________________________________________________________________________ The implication is that SST could produce the NAND component of the module and may elect to do so in the future, but has made the business decision to let others produce that component...I graciously stated that SNDK could also be viewed as a supplier to include in the etc. part of the broker's report. I made the assumption that anyone purchasing NAND flash from Toshiba would also be contributing to SanDisk's top line given they are embarking on the JV that employs technology from both companies. I still believe the likelihood that SSTI enters the ultra-high density NAND market is remote (i.e. "improbable"). ______________________________________________________________________________ SSTI has a competitive advantage over most of the industry in producing low density NOR flash and is working that core competency of their business very hard and very profitably. SNDK has a competitive advantage over SSTI in producing high density NAND type flash and is working that advantage very hard and very profitably. Again, I see ADC (and other analagous products such as Dick-on-Chip) as mass storage products utilizing flash. I view the ultra-high density flash component as the key ingredient to a successful product. IMHO, the controller technology in this device represents a much lower barrier to entry for competition. Is SSTI evolving into a low density code storage and custom microcontroller/ASIC company and away for a turnkey embedded flash supplier? ______________________________________________________________________________ It sounds like we have no clear evidence that either SNDK or SST collect one dime from the other in the form of royalties or license fees, only speculation in this regard. Huey, the key difference here is the business model. SanDisk is in the business of licensing its technology in return for royalty revenue, then using those dollars to bolster R&D and invest in its own fab. SSTI barters its IP for consideration of flash production. If SanDisk uses SSTI's SuperFlash in its controllers I would suspect that they may be paying SSTI a licensing fee. If SSTI uses SanDisk's IP for its CF card assortment I suspect they pay a licensing fee to SNDK. Is it a zero sum game? That is difficult to know. I do know, however, that one of SanDisk's strategies is to continue building the royalty stream it receives. This growth has been spectacular in 1999 and 2000. SSTI's royalty stream contributes significantly less to total revenues. This contribution is also decreasing both as a percentage of the total revenues and in terms of absolute dollars. This is a major difference between the two companies. SanDisk appears to be in a position where the firmware in the SDMC controller is becoming more and more complex. The instruction code for the operation is probably growing and they need a new means to embed code within the controller with currently available technology. This may be something they are having trouble with. Thus, the alliance with Tower has great importance. SanDisk has cast a strong vote of confidence in MicroFlash. Again, why invest in Israel when you have a solution just down the street? ______________________________________________________________________________ Regarding the SST press releases; I do think they were somewhat confusing. On the other hand, SST is under no obligation to trumpet NAND flash components produced by Samsung and Toshiba used in SST's proprietary ADC design. I agree. However, as an individual investor it is easy to misinterpret the press releases. One may be led to believe that SuperFlash allows SSTI to easily enter the ultra-high density storage market implied by the August release date. Even Eric Z., someone who has put SSTI under a microscope, believed this was the case. Again, I see the greatest feature of ADC being its non-volatile, disk drive emulating, mass flash storage feature. I mean no offense here, but focus solely on the controller seems to be a bit misdirected. ____________________________________________________________________________ I expect SST to continue to make a great deal of money throughout calendar year 2001 ($4.55 per share or better) by focusing on its core competency---producing low cost, high margin, low density NOR (code) type flash. I believe SST is meeting with some success in its stated objective to dominate the NOR code storage market by first dominating the low-density flash market. There is no doubt that SSTI is firing on all cylinders and they are well settled in their niche. Best, Aus

To: hueyone who wrote (13476)	8/1/2000 4:14:40 PM
From: Starlight	Respond to of 60323

Atmel Releases 64 MB Flash Memory Chip - (Don't know if this was posted before or not. This is embedded --) embeddedtechnology.com{FF6BC541-649D-11D4-8C56-009027DE0829}&Bucket=Industry+News Here's another new flash product - Flash Disk: embeddedtechnology.com{7CA44B53-66CC-11D4-8C57-009027DE0829}&Page=1 Flash Disk The DiskOnChip DIMM2000 is a 16 to 256 MB flash disk that is less than 4mm thick.