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Technology Stocks : Wolf speed -- Ignore unavailable to you. Want to Upgrade?

To: Don Green who wrote (6474)	11/18/2002 12:00:54 AM
From: pompsander	Read Replies (1) \| Respond to of 10713

While I certainly don't claim to be any kind of expert on optoelectronics, Sapphire, silicon carbide, epitaxy or the legal issues involved...........it is interesting to ponder why the settlement came now. It would appear that Cree has won some legal victories lately, and possibly had a good chance to continue prevailing in the patent disputes with Nichia. Nichia has also been "cleaning house" legally over the past few months. Both have been spending significant sums on legal expenses. So, why the settlement and why now? I imagine that a group of events coming together put pressure on both parties to get this over with and clear the decks for product rollouts. Cree has a licensing agreement with Rohm, both for LEDS and the blue laser. Nichia has its own product development and packaging infrastructure partnerships underway. All the partners would want to ensure there are no legal roadblocks in the way before they commit full-scale to development of blue laser development and rollout in accordance with the standards set by Blu-Ray earlier this year. It would appear that both firms may be nearing the lifetime and diode strength necessary to meet the read/write capabilities required by the consortium before development would be supported. So, while cree and nichia (and their surrogate partners) battle it out, product development and potential market size continue to become clearer. Suddenly, they both step back from the battle and realize that since many customers are likely to want two sources for product anyway. Also, their technologies, while similar in final result are still substantially different in desing and composition.......and, most importantly, the marketplace is big enough to allow each to prosper, but not big enough to allow a third and fourth technology to enter the field. Time to stop the battle, pick up the pieces, straighten the ties, and get back to selling product. Now, with no legal barriers to deployment for either firm, the partners can commit the funds necessary to roll out the technologies and meet the expected demand. Who gave up more in the settlement? Who knows. It doesn't appear anyone had to settle...both had ample resources to continue the struggle, but maybe common sense intervened and both realized that even if they had prevailed they would have had little more than they already have achieved by the settlement route. Presumably it was the call of the market which got this done. I hope so.