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Non-Tech : The Critical Investing Workshop -- Ignore unavailable to you. Want to Upgrade?

To: Sully- who wrote (30991)	8/29/2000 7:23:55 PM
From: Sully-	Read Replies (1) \| Respond to of 35685

Driving the RAM-bus The Bull Rebuttal By Tom Jacobs (TMF Tom9) It doesn't matter whether Rambus's technology is better or worse Rob makes a deft stab at the techie geek argument. (Hey, he told me I could say that; techie geeks did inherit the earth, after all!) But as I said in my opening, the days are over when it mattered whether Rambus's technology is better or worse than the competition, whether it's the Betamax or the VHS, the Apple or the Microsoft. Today's story about Rambus is about one thing: How many of the top 10 DRAM makers will agree to pay Rambus royalties on all DRAM, including SDRAM and DDR, and not just Rambus's technology. Three have signed on. Seven to go. I'll take Hitachi's, Toshiba's, and Oki's patent lawyers over Rob, no offense Rob then valiantly takes on the patent issue, donning his patent lawyer cap. He declares that any first-year engineering student knows Rambus's patents don't cover SDRAM and DDR. He should stick to his Fool cap. If it's so easy to know that Rambus's patents are bogus, then why did Hitachi, Toshiba, and Oki agree to pay royalties to Rambus for their chips that use competing technology? I'm no patent lawyer, but I bet Hitachi, Toshiba, and Oki have more than one -- along with plenty of engineers -- and these three memory makers inked deals with Rambus. (By the way, who cares whether NEC is or is not Japan's largest chip maker? After Samsung, Hyundai, and Micron, NEC is the fourth-largest DRAM maker. And the second- and third-largest Japanese DRAM shops -- Toshiba and Hitachi -- have signed deals with Rambus.) RDRAM is here, it's available, and people are buying. Here is a list of computers available today that contains Rambus's RDRAM. If, as Rob asserts, Intel is having enormous problems making appropriate motherboards for RDRAM, then whose motherboards are in the Dell (Nasdaq: DELL) and other top-name machines on that list? The story has never been substantiated that an Intel internal document reveals abandonment of Rambus. Nor is it news that the Pentium 4 will come in both SDRAM and RDRAM flavors (and not the DDR flavor because it's not available). Also, the price of RDRAM keeps dropping relative to SDRAM, per this discussion board thread. Does Rob honestly think that "commodity" SDRAM will win when there's little or no price difference? Investing in Rambus today is risky -- as is investing in any new technology that shakes up the existing order. Rambus's profits will flow in large part due to the willingness of the top 10 DRAM makers to pay Rambus royalties on RDRAM, SDRAM, and DDR. Three of those 10 have caved. The other seven's decisions dictate Rambus's performance in the coming years. In my opening, I detailed the risks and the magnitude of the possible rewards. The odds of the rewards are why I'm a bull on Rambus. aolsnapshot.fool.com