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

To: Ausdauer who wrote (15330)	10/5/2000 9:32:24 AM
From: Art Bechhoefer	Respond to of 60323

Aus, Cooters, and all: The assumption I have made is that both Hitachi and SanDisk have enough proprietary knowledge to justify producing flash memory units incorporating patents held by both companies. Thus, if my conservative assumption is correct, there is no need for royalty payments on flash memory unit sales where the features of each are identical. I concede that there might be some arrangement not publicized where each company pays the other a royalty for the number of flash memory units shipped from the Hitachi factory. If this is true, then the royalty payments to SanDisk will be much greater than from SanDisk to Hitachi, since SanDisk gets only a small portion of the production from the Hitachi plant. The other point that I was trying to make was that, even if there are no royalties that need to be paid, the total production capacity of SanDisk goes up considerably, enabling SanDisk to increase its profits simply by having more production to meet the growing demand. It's a winner either way. Art