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

To: Cooters who wrote (19412)	3/2/2001 9:28:25 PM
From: Michael Kim	Respond to of 60323

Thanks for the effort Cooters! I must say while I don't feel a whole lot better about my SNDK investment, I feel a little better - and these days, a little better is pretty good for me! As with the QCOM and RMBS models, it did take some time for the IR to truly become fully-baked, where the critical mass of standards adoption maximized the technology's value - let's hope the same holds true here.

To: Cooters who wrote (19412)	3/2/2001 10:37:06 PM
From: Ausdauer	Respond to of 60323

"I told Frank I would word questions about royalties to avoid any forward looking statements. I wanted to know what percentage of CF card sales not manufactured by SNDK generated royalties. He said that was difficult to determine because they do not receive(or maybe it was record) royalties based on card design. I believe this means royalties are at a technology(component) level, and not the finished product. A later statement indicating their license agreements are not categorized in a CF vs. MMC fashion(by standard), but by technology, seemed to support my line of thinking." Cooters, Thanks for the information. As you stated, I think the missing link here is that they have been successful at amassing licensees at the component level (Toshiba, Samsung, Hitachi, Intel,...), yet have been unsuccessful at tacking down card manufacturers on card assembly technology ('987). Hitachi supplies virtually all of SanDisk's competitors with flash and controller technology except Lexar Media. It is these assemblers who will have their feet held to the fire next. Cindy Burgdorf told me in 1998 that SanDisk will license the flash RAM version of MMC. MMC is a Siemens/SanDisk invention. Perhaps they are trying to get the smaller card assemblers to agree to both CF and MMC licenses at the same time. This could take some time to hammer out. These are my notes from a phone call with Ms. Burgdorf now almost three years old... Message 4571065 I noticed today that Kodak is taking on the entire digital camera market by enforcing their patents. Olympus is the only company who had patents Kodak felt were worthy of a technology exchange. The remaining manufacturers are apparently being wrestled into licensing agreement or are being sued. I hope Eli and Co. are playing hardball with their competitors as well. See these old links for more details... Message 13387110 Message 13369885 Hope this is helpful. Aus@Hitachi_customers_are_killing_us.com

To: Cooters who wrote (19412)	3/2/2001 10:54:48 PM
From: Ausdauer	Respond to of 60323

MMC is a Siemens/SanDisk co-invention. mmca.org Aus

To: Cooters who wrote (19412)	3/2/2001 11:40:10 PM
From: Craig Freeman	Read Replies (1) \| Respond to of 60323

Cooters, many thanks for pressing your (our) rights and finally getting a response. Given all of the good news that you have learned, how do you explain the fact that SNDK's P/E is projected to be below the average for the S&P at year's end? IMHO, this makes no sense at all. Craig

To: Cooters who wrote (19412)	3/3/2001 6:17:07 PM
From: Art Bechhoefer	Respond to of 60323

Cooters, your conversation with Calderoni was very helpful. Many thanks for your efforts. A couple of points strike me as important. First, the response on royalties from CF and MMC being difficult to estimate seem very evasive. Any company knows, or ought to know what its competitors are doing, and whether its competitors are using any portion of its intellectual property rights. Either SNDK sees infringement and is doing something about it, or its so-called intellectual property rights are unenforceable. Second, and somewhat related to the first, is that, as we already know, SNDK has cross licensing agreements with several major firms, such as Intel. It sounds to me as if SNDK has for all practical purposes gotten into a situation where patented products made and sold by others don't produce ANY royalties because of the all-encompassing cross licensing agreements. Until I hear otherwise, I'm going to assume that most of the SNDK patents no longer can generate substantial royalties--maybe only ten percent or less of total revenues. I will estimate future earnings using this assumption. The lack of royalties leads to a more important issue--whether SNDK is the lowest cost producer, or close to being the lowest cost producer. If so, then we have a commodity business where SNDK is still in the driver's seat. Given the new plant being built in Virginia and the fact that a partner in the venture is Toshiba--a company with a good manufacturing record, it is likely that this plant will be extremely profitable, not just in manufacturing efficiency but also in the type of products to be made in the plant--high capacity cards. Although I'm disappointed that it is so difficult to get any details from SNDK, I think the price targets on the stock, by firms such as Merrill Lynch, are totally unjustified and based on very likely imaginary data. I can't make a very educated guess as to the potential for the stock, but I know that it is considerably more than the $29 target in Merrill's latest advice (dated Feb. 28). That new target replaced an earlier price target of $50. I don't know where they got the data to arrive at that one either. Art