KNX 1070 Business news also kept reporting only the "spin" yesterday that Rambus was down based on Intel's reported rejection ...they offered absolutely no objective or restrained comments, only sizzle.
Just noticed today's in IBD (11/1/00) "Business News" snippets, the headline blurb: "Intel to Phase Out Rambus Memory." Deeper in the newspaper, they ran this article on Rambus:
investors.com
Internet & Technology
Wednesday, November 1, 2000
Intel, AMD In A Rare Accord; Rambus Suffers
The memory chip company's shares fall on continued word that chip kings favor design that competes with Rambus
By James DeTar
Investor's Business Daily
Rambus Inc. has absorbed a few body-blows in the rough-and-tumble tech field, but analysts say it will recover – again.
The latest shot apparently wasn't even news, yet it sent Rambus shares falling. A trade newspaper Monday said that Intel Corp. will stop using most Rambus Inc. memory chips.
Rambus reeled. Its shares fell 8 1/2, or 16%, to 44 15/16. Earlier in the day, shares had fallen almost twice as far.
That's a six-month low for the stock. But the company long has been an up-and-down performer. In fact, for the last six months, its shares have performed in the top 4% of all stocks, according to Investor's Business Daily.
And this time, too, analysts say that they don't see any knockout blows. The company's powerful memory chips still will be used in devices when raw speed is needed, analysts say. This includes video game machines and high-end computer workstations.
Intel, in fact, on Monday said its plan to quit using most Rambus memory isn't new. Earlier this year, the company said that would be the case.
Before then, Intel had planned to use Rambus memories because they're faster than rival designs. But the high cost and lack of availability of Rambus memory chips made Intel re-think its strategy.
Bet Didn't Pay Off
"We have had to adapt," Intel spokesman Michael Sullivan said. "We had originally planned to use (Rambus memories) in more areas, and now it's limited to the performance segment."
At a recent conference, Intel Chief Executive Craig Barrett said the company had "made a big bet on Rambus, but it did not work out the way we'd liked."
Intel isn't the only one throwing jabs at Rambus.
Sony Corp. last week started selling its Playstation 2 game console in the U.S.
Sony had planned to ship 1.5 million to 2 million Playstation 2s in the U.S. by year-end. Now, it says it will ship 500,000 fewer, blaming parts shortages.
Though Sony didn't name any supplier, analyst Miguel Iribarren at Wedbush Morgan Securities in Los Angeles said, "It uses Rambus memory, and that's in short supply."
Advanced Micro Devices Inc. also took a poke at Rambus this week.
AMD, the second-largest chipmaker behind Intel, and second only to Intel in number of PC microprocessors shipped, on Monday came out strongly for a Rambus rival design called double data rate. AMD says it will support DDR memory chips for its flagship Athlon line of microprocessors.
Momentum Favors Rival Chip
In a statement, AMD quoted a report by Semico Research analyst Sherry Garber, who said, "The PC industry's memory momentum is clearly in favor of DDR."
Garber says she sees a place for Rambus chips, but only as a niche.
"We continue to believe Rambus is a niche product. They will roll it out in high-end desktop PCs," Garber said on Tuesday.
And then there's the legal battle. Rambus claims its design patents cover nearly every type of DRAM memory and it's been demanding that companies that make other types, such as synchronous DRAM, pay royalties.
Analysts say that issue is one reason Micron Technology Inc. – the biggest U.S. memory chipmaker – is reluctant to make Rambus memories. It's one of the companies Rambus is suing. Micron says its customers aren't calling for Rambus-type memories.
So with all these hits, is Rambus on the ropes? Apparently not. Rambus reported a September-quarter per-share profit from operations of 9 cents, up from 3 cents in the year-ago period. Revenue rose 119% to $26.9 million.
On Oct. 17, Rambus opened an office in Taipei, Taiwan. It says that will be the launch pad for an assault on the potentially huge China electronics market.
Sees No Commitment Change
Rambus Vice President Avo Kanadjian says five companies are making Rambus memories: Samsung Group in Korea, Germany's Infineon Technologies AG, and Japanese companies NEC Corp., Toshiba Corp. and Hyundai Electronics Industries Co. Micron has licensed the design but hasn't begun making the chips.
When asked about Intel's change in plans, Kanadjian says nothing has changed.
"Basically, we don't look at this as a change in Intel's commitment to the Rambus technology," he said in a recent interview.
"We think Intel is looking at how to deal with the overall market," Kanadjian said. "When Intel plans to do the Pentium III to Pentium 4 transition in 2001, they want to have the flexibility to do that without being hampered with a shortage of memory parts."
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