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

To: Apollo who wrote (489)	12/9/2003 12:48:33 PM
From: Don Mosher	Read Replies (1) \| Respond to of 2955

Apollo, Carlota Perez's book is expensive; but not nearly as expensive as not understanding the historical dynamics of bubbles. For me it is an orders of magnitude difference! Because I am an Emeritus Professor, I probably have more tolerance for big words, a dense unfolding of new ideas, and an academic style. Indeed, I experienced excited interest while reading it. Perez worked with the Sussex school, notably Chris Freeman, whom I also respect highly. As for Wind River, I sold it and bought ARMHY once I understood which company controlled the critical architecture and had become the international standard. Moreover, I manged to buy quite a few shares at bargain basement prices, which I rarely do because of my anxious impulsive dersire to own what I perceive as true treasures. I seem to be slow to recognize that such insights are not always widespread and that any sensible person would be better at timing and price. That is why my darling wife, Susan, buys our antiques, slects her jewels, and bargains for our other decorative Asian hand-crafted treasures. A real-time operating system is most relevant in nonconsumer technologies. The market tornado occurred in GSM handsets, which included ARM's core as a hidden module, pulling it like IBM pulled Intel and Microsoft into architectural power. ARM has a larger addressable market by far, and it has become a critical architectural component because of time-to-market and reliablility of its proven core solution. It rides Gordon Moore's Law and Geoffrey Moore's principle of outsourcing non-critical and non-core competencies. Its value chain is outstanding and growing. I consider it a gorilla, although it fell late in the bursting bubble. I like its intellectual property model and fabless nature. Perhaps, I should have understood that WIND's emphasis on securing cooperation with semiconductor manufacturer's for early porting and simultaneous rollout revealed that they needed them more than the other way around. Although the Wind River operating system is an architectural model, its lacks a strong value chain that uses its hidden information. I consider it to be aperipheral complement to Intel and limited in its market to realtime systems. As I understand more about architectural control, I become more sophisticated in discerning where value lies within the system. I believe that one must distinguish between companies who (a) control a system architecture or (b)who have used the modal operator of inversion to become architectural modules from (c)hidden modules who use the public information in the design rules, including interface rules, promulgated by A and B. The principles of modularity, abstraction, information hiding, and positioning within the nested hierarchy of levels within a system are the key ideas. But, if you want to understand these, the best account is another expensive academic book, Design Rules: The Power of Modularity, by Carliss Baldwin and Kim Clark. This book is the best that I have read in the last seven years for clarifying and extending the set of ideas that Geoffrey Moore calls a "proprietary open architecture." Also, their theory explains the evolution of the computer, including its splitting and substitution operators, in a stunning theory of design evolution in complex adaptive systems. This is another expensive academic book, and it is even more exciting for me than that of Perez, but I have had to read it five or six times to grasp some of its major ideas. I find it very pleasurable to read and study, but it is a cultivated intellectual sort of pleasure that may be reserved for formal or informal scholars. But, the information is so valuable to investors! I hope to write a series of somethings sometime to explain these ideas. However, I cannot compare conceptually nor match the originality of these outstanding academicians within their specialities, but I can be a bit more oriented to an investor audience. However, given the lack of response to my last two pieces that I placed on this thread, which centered directly on the TALC and the TALC in Moore, I doubt that readers of this thread are truly interested. I may be too academic for such masters of capitalism. I intend to post one more piece here, as promised, before I isolate myself in my oceanside Sky Castle that has more or less replaced the Ivory Tower where I previously dwelled. Best, Don