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

To: tekboy who wrote (40409)	3/14/2001 3:51:01 AM
From: EnricoPalazzo	Read Replies (1) \| Respond to of 54805

GM on XBox: Gang, In my view this is an important but high-risk investment for MSFT the following reasons. First, the game category, as a category, is a terrible investment. Each generation has one winner only, and the winner in any one generation has never been the winner in the next one. Ugh! The problem is that there have never been any switching costs since no one really wanted to play their old games on the new console. In short, you get astronomical GAPs with crummy CAPs leading to phenomenal spikes -- not the sort of thing the gorilla game likes. Second, to get into the category you have to subsidize the console. Sega has damn near gone under trying to subsidise its latest machine, and MSFT will not find it any cheaper. Sony crippled itself by being unable to get yields on its key chipset, and so has outsourced its future chipsets to IBM. This is an ugly, ugly business. The reason that MSFT, nonetheless, should enter the business is in order to get a foothold in the fight for the living room. Because it is not well positioned at the outset, it must make some kind of high-risk move to change the playing field. The Xbox has the potential to be such a move, if -- AND ONLY IF -- MSFT can create some sort of switching costs. It is not obvious to me how you do this, but that is what we should be watching for. Geoff

To: tekboy who wrote (40409)	3/14/2001 6:24:25 AM
From: Bruce Brown	Read Replies (1) \| Respond to of 54805

don't we just have to look at those EKG thingies and draw a line from the depression of 1612 through 1932 and on til today? that's so much easier... Sure. Draw the line wherever you want to draw it. Nasdaq 800, Nasdaq 1200, Nasdaq 1500, Nasdaq 1800, Nasdaq 1900, Nasdaq 0 - it's all fair game. Just stay away from the window and do not operate heavy machinery. nah, I figure I'll just copy off Id. Besides, I'm too busy envisaging farts. I'm glad the wind is blowing to the west today.... PS actually, I love it when you valuation junkies talk dirty...maybe we could create like a "finance personals" page...you know, "TTM PEG with attractive fundamentals seeks EPS, the larger the better; looking for long-term commitment and postive DCF, must like backing out one-time charges." Is that why you are up at this hour? And I thought it was all for a diaper change... In this kind of a market it doesn't matter if you were phoning around the personals for handsome trendlines, gigantic EPS growth, firm ROIC or fun PEG's - the personals might find a lot of hostile conversations on the other end. ekboy/Ares@KoolAidisbetterthanCoke.com Everything has been rolling over in Europe today to the point that yesterday's respite might have been an invite to drinking a type of KoolAid that was spiked with some really nasty stuff. And here I was beginning to think that only technology could sell off in mass.... BB