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Technology Stocks : Rambus (RMBS) - Eagle or Penguin -- Ignore unavailable to you. Want to Upgrade?

To: jim kelley who wrote (72920)	5/15/2001 11:05:22 AM
From: SBHX	Read Replies (1) \| Respond to of 93625

Jim, There are many fabless innovators who manufacture goods. NVDA and QCOM comes to mind. I think you are right. On paper, a pure IP house that doesn't cross-license has a much better business model than one that manufactures goods and relies on cross-licenses to keep royalties down. But that really depends on the actual strengths and enforceability of the patent themselves. Let's take your QCOM example. QCOM was confident enough of their IP that they were willing to manufacture IC components. If only rmbs were confident enough to do the same. I do know that if a pure IP house has such a powerful business model, then there will be little incentive to manufacture, and all of high tech will move to the same business model as the drug companies. Consider the development of the whole PC industry and think how many tens of thousands of patents are in the sum of all the components in each PC. If there is minimal manufacturers, and most choose to live off patents, the cost of PCs will follow the cost of the drugs today. Open Standards has brought us the cheap $299 celeron desktop systems today. I think that is quite an accomplishment for the hundreds of thousands of engineers worked to make it happen. This is primarily why many common people who worked in the PC industry consider the idea of rmbs anathema to everything that made it all possible. Even Geoff Tate's speech on outdated business models sound like a bean counter's distorted view of life. What Tate doesn't realize that profits did not drive the PC pioneers to invent. It was always the challenge of doing something that wasn't done before. Inferior business model or not, I think many people in the trenches are actually proud that PCs can be bought so cheaply today. SbH