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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: Road Walker who wrote (24851)	2/4/2004 6:56:10 PM
From: Steve 667	Read Replies (1) \| Respond to of 60323

John: "As more product comes into the market, companies fight for market share. The average selling price goes down faster than the cost to manufacture goes down. Margins on flash chips sink to single digits, but fixed costs including but not limited to fab depreciation remain the same." Cost for all the CARD manufactures would go down, including SNDK since they use non-captive chips in addition to their own. However, non-captive chips are not going to go below what SNDK'S cost, since other chip makers have to include fab depreciation into their chips as well. Also the other chip makers have to put their own profit into the sale price of their chips as well. I have a hard time believing that all these chip makers are just going to make as much as they can just to sell them at cost. And I don't think it would make much of a difference if they did. I don't think there is enough distinction between card makers and chip makers. If it were that easy to buy cheap chips, and slap a few parts and sell them as flash cards, Sandisk would not be getting 20 plus million each quarter in royalties. Name one company that used DRAM in the manufacture of their own product that lost revenue because the cost of DRAM chips dropped due to lots of supply? I say no to "DRAMIFICATION".! <gg> Regards, Steve