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

To: DaYooper who wrote (36049)	12/6/2000 9:37:33 PM
From: Mike Buckley	Read Replies (1) \| Respond to of 54805

DaYooper, Corrections, if necessary, by the head nitpicker would be appreciated. With a door opened that wide, how could I resist the temptation to walk in? :) [Nokia:} Not a chimp actually, in gg terminology. Closer to a monkey I don't pretend to know all the markets Nokia is in. If you're referring to the handset market, that's a royalty game in which Nokia doesn't have twice the market of its next largest competitor. That makes Nokia a prince. but TXN is a better example of a monkey - to spinco - not q classic. Probably best described as just another member of the value chain or as a king in the commodity business of device manufacturing. I don't know about TXN's market share. If it's got twice the market of its next largest competitor I'd also call it a King. The issue of whether or not it's a monkey is fuzzy (that's fuzzy, not furry! :) for me. That's probably true mostly because I don't focus on the low tier that monkeys occupy. Noting that the distinguishing characteristic of a monkey is that it sells 100%-compatable products to the gorilla at a discount and that we don't know what the pricing policy of TXN's chips will be compared with chips sold by Spinco, it's probably too early to clearly label TXN relative to that issue. I agree wholeheartedly with you when you write that TXN is "best described as just another member of the value chain." If I were to disagree, it would be in the area of emphasis. It's not "just" another member. It's one of the more valuable members. Howz that for nitpicking?! --Mike Buckley

To: DaYooper who wrote (36049)	12/7/2000 12:11:05 AM
From: BirdDog	Respond to of 54805

Not a chimp actually, in gg terminology. Closer to a monkey... May I kindly beg to differ? At first glance; one would think of this as a Monkey position. Simply because a Chimp does not sell the Gorilla's product. However I'm afraid this whole situation of Qualcomm's licensing intellectual property brings up a conflict of what to label the licensee's. I think we could have a very in depth discussion of this. Perhaps even come up with a new label for these beasts. I would like to say that my thinking stems from pg59 of TRFM. "The chimp is thereby forced to take one of two paths: 1: Continue its attack on the gorilla in an attempt to wrest mass market control away from it. 2: Retreat into one or more niche markets to become a "local gorilla" inside the niche. We now know from the past decade of high-tech market history that the first of these strategies is simply fatal." I was thinking that path number 2 is what Nokia was claiming. Also in the article first stated: Nokia was claiming to become number one in CDMA handsets. The handsets being the niche market. Thus followed my "chimp" thinking. But then the "not selling the Gorilla's product" must be compromised. On second thought, lets see: On page 60 of TRFM it is said: "So chimps must never attack gorillas-at least not directly. Instead, their correct response is to take the second alternative noted above-to focus on niche markets whose special needs are being ignored by the gorilla's mass market approach, to enter and dominate those niches as rapidly as possible." I would also like to point out that the Gorilla does not make handsets (anymore). I would also like to point out that Nokia is a member of the GSM consortium that is made up of a bunch princes who have taken as good of a fighting chimp position toward Qualcomm as they possibly could. I think you would agree that this is not a clear cut label in this situation. I however cannot say you're wrong in labeling Nokia a monkey in this situation. I could say you're very right. I also think this could lead to a very involved discussion? BirdDog