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

To: Ausdauer who wrote (18808)	1/29/2001 6:32:54 PM
From: LiPolymer	Read Replies (1) \| Respond to of 60323

I saw that HP was selling digital cameras with SNDK cards, but these are the old red and white labelled cards that don't really enhance brand recognition. I fail to see the wisdom in that arrangement. FWIW the HP200 I got for Christmas has a Delkin card (8MB).

To: Ausdauer who wrote (18808)	1/29/2001 6:39:44 PM
From: Art Bechhoefer	Respond to of 60323

I think it is highly unlikely that an OEM would be able to cancel a contract with SNDK in order to buy a competing product at a lower price. On the other hand, I can understand that a contract might be written for a minimum number of products and the orders exceeding that minimum being cancelled because of slower sales. SNDK would then end up with excess inventory, having already made the cards in anticipation of continuing orders from the OEM that never materialized. This might be one reason why CF cards with 8 mb capacity have recently been showing up in WalMart stores in my area of upstate NY. That low capacity is generally supplied to the camera maker, and a larger capacity card usually appears in retail stores. Art

To: Ausdauer who wrote (18808)	1/29/2001 7:15:43 PM
From: Steve 667	Read Replies (2) \| Respond to of 60323

It has to be even worse than it appears! Regarding: Private labeling Steve, SanDisk's brand exposure from these OEM agreements are minimized by private labeling. For some OEM's like Kodak who sells flash separately under their own name. But for others like Nikon, they just include the original card with the manufacture label and card maker literature. The value in selling to OEM is really to get your product into the hand of the consumer. If you get your card and promotional material included with a camera that is sold, that consumer is more likely to buy your product when he goes to get a higher capacity card. So from that perspective it is almost worth it to sell them close to cost! Thinking out loud. This just occurred to me. Consider that the TOTAL product revenue came in about $35 million short. They stated that retail sales were better than expected, so that means that the OEM sales must have been more than just bad to make the average of the two only a 2% increase over the previous quarter instead of 25%. What number do you add to 25+ to make the average of the two numbers come out to 2 ? The fact that OEM is low margin makes it even WORSE Magnitude Magnitude Magnitude!!! Steve 667