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

To: Ausdauer who wrote (17822)	12/30/2000 4:02:13 PM
From: add	Read Replies (1) \| Respond to of 60323

The fact that a lot of 128MB remains unsold means that its still too highly priced. THe die shrinkage will only result in the 128 MB cards being sold for something a little more that the 64MB cards. The question is how long can they keep the prices up relative to the other players ? I think the discounting of the 32 and 64 was aimed to drive LEXR out of the market. With the slowdown in the economy, I expect demand will equal supply sooner in '2001 than most people expect. This is the reason for the ML downgrade. Given a balanced situation, you have to compete on price and features. I think the two features that stand out head and shoulders above the others is price and capacity. If you believe that management knows that demand has cooled which they must then the fact that they are already discounting against LEXR is both good and bad news. The bad news is that margins are going to be dropping going forward and the smaller players don't have a chance in hell given the scale. The guy w/ the biggest scale wins usually. The good news is that management is quick to respond ! THe fact that we have cycles in the industry is no new news. What you want is a deft manangement team that can survive all types of economic and competitive conditions. The real question is not demand anymore. Obviously digital cameras, handhelds, MP3 players and the like are here to stay. The question now has to focus on who has the lowest cost at the highest flash capacities at how long of a lead time compared to the competition? Maybe the more regular posters can inform us a little better on that question.