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To: blake_paterson who wrote (73003)	5/16/2001 8:15:29 AM
From: gnuman	Respond to of 93625

Blake; I think you are painting a picture of excess productive capacity, not under-consumption. WRT the PC industry, I think you can make the case that excess capacity and large inventories are the result of under-consumption. Planning for historical growth was the key error by the makers. With growth typically >15% YOY, we are now in a period of flat to negative growth. For example, look at the YOY growth numbers from IDC. USA Q3'99 30% / Q4'99, 17% / Q4'00, 0.3%, W/W Q3'99 28% / Q4'99, 19% / Q4'00, 9.2%, I don't have the breakdown by geography for Q1'01, but W/W: W/W Q1'00, 20% / Q1'01, ~3% The lack of growth in consumption exacerbates the problem for the memory makers, since growth in PC shipments is accompanied by growth in bits/PC. JMO's