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

To: kumar who wrote (29240)	8/1/2000 11:41:35 PM
From: EJhonsa	Read Replies (5) \| Respond to of 54805

There's been no discontinuous innovation, but there's a proven substitution threat, and I'm typing from it. AMD has taken a significant portion of the retail market, by the way. Some Dataquest or IDC numbers would reflect this. Maybe the DSP, flash, and networking chip markets aren't Intel's core competencies, but they need something to drive their growth in the future. Otherwise Intel can't really justify a multiple much higher than that of a Pfizer or a Micron. All of this just goes to prove my point: judge Intel by its investment potential, which to me, appears very suspect right now given how its growth's slowing down, and how they have second-rate products in a lot of the secondary markets they're looking for to fuel their growth. If using the GG as a framework helps you analyze Intel, then that's all for the better. But you can't expect it to give a nice, clear answer each time. Don't take this the wrong way, but it's best to think for yourself on this issue, and not blindly follow what the GG classification of Intel would be. I'm sure that Moore would appreciate it just as much as I would. Once again, with all due respect, Eric

To: kumar who wrote (29240)	8/1/2000 11:42:34 PM
From: Rick	Respond to of 54805

Just posted on the Moderated thread: "Another big investment bank, Japan's Nomura, also warned recently that GPRS may be delayed because it is proving difficult to create stable handsets and networks." <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> To: Kent Rattey who wrote (1800) From: Jon Koplik Tuesday, Aug 1, 2000 11:35 PM ET Reply # of 1801 WSJ article with juicy tidbits about GPRS being lousy. August 2, 2000 Downgrade of ARM Signals Skepticism About Wireless Web By DAVID PRINGLE Staff Reporter of THE WALL STREET JOURNAL LONDON -- Casting further doubts on the medium-term prospects for the wireless Internet, investment bank UBS Warburg cut its share-price target for U.K. chip-designer Arm Holdings PLC due to the disappointing debut of next-generation mobile-phone technologies. Warburg cut its share-price target for ARM to 840 pence (13.59 euros, $12.60) from 1,000 pence, citing the failure so far of WAP technology to capture consumers' imagination. Warburg, which estimates that the mobile-phone market currently accounts for about 55% of ARM's revenue, also "downgraded our longer-term forecasts to take account of the increased uncertainty associated with this revenue stream." Shares of ARM were down 4.8% in late trading Tuesday, as investors digested this downbeat prognosis for the wireless Internet by a previously bullish investment bank. Recent figures show disappointing takeup of WAP technology, which allows users to access a subset of the Internet through their mobile phones, and that prompted the Warburg rethink its forecast. British Telecommunications PLC said earlier this month that only one in four of its new second-quarter wireless customers in the U.K. had opted for a WAP phone, and Vodafone AirTouch PLC said it had sold only about 50,000 WAP handsets in the U.K. since their launch around the turn of the year. T-Mobil's subscribers in Germany have also been slow to embrace WAP. Analysts believe these figures reflect adverse publicity about WAP in the wake of technical problems and a shortage of compelling services. Seeking to downplay the Warburg note, ARM said that it designs chips for all kinds of digital devices and is becoming less dependent on the mobile phone sector. "We never thought these things were going to roll out quickly anyway," said Jonathan Brooks, ARM's chief financial officer. "I, personally, never thought it [WAP] was going to be a big thing." Warburg is also concerned, however, about delays in another mobile phoneAnother big investment bank, Japan's Nomura, also warned recently that GPRS may be delayed because it is proving difficult to create stable handsets and networks. technology, general packet radio services. Mobile phone operators across Europe are planning to use GPRS software on their networks to offer users a faster, always-on connection to the wireless Internet. Analysts see GPRS as the key to making the wireless Internet, and WAP in particular, more attractive to consumers. Although both BT Cellnet, BT's wireless unit, and T-Mobil, which is part of Deutsche Telekom AG, have already rolled out GPRS networks, suitable mobile phones are not expected to be available in large volumes until the first half of next year. But Warburg's price reduction for ARM also reflects a change in sentiment among technology investors, who have become increasingly nervous about new mobile-phone technologies since Finnish mobile phone maker Nokia Corp. issued a profit warning last week on the back of delays to some new handsets. Nokia's shares fell 21% following the warning. However, a Nokia spokeswoman said that it had not changed its timetable for the launch of GPRS handsets. Some analysts further warn that third-generation mobile phone networks, set to roll out in Europe in 2002, may also fail to live up to expectations. Nokia told analysts in Finland recently that it believes third-generation networks will be able to carry data at just 156 kilobits a second, rather than the widely expected 384 kilobits a second. Joe Barrett, head of 3G marketing positioning for Nokia, said that operators will be able to offer higher speeds, but only if they build large numbers of new base stations. If networks do run at speeds of 156 kilobits and less, video conferencing and other data-intensive applications might not be feasible. However, Nomura's Nainish Bapna remains optimistic that consumers will still buy third-generation handsets once they become available. "They will still be far superior to what they have now," he said. Write to David Pringle at david.pringle@wsj.com Copyright © 2000 Dow Jones & Company, Inc. All Rights Reserved.