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To: William T. Katz who wrote (24262)	10/23/1997 11:43:00 AM
From: Kelvin C.P. Wang	Read Replies (1) \| Respond to of 50808

The primary market for VCP chips is in China. The exchange rate between US $ and Chinese currency is stable and controlled by the Chinese govenment. It will be impossible to change the rate as no one can attack the Chinese currency. The Chinese government can only devalue the yen in the future. Therefore, no currency crisis for CUBE. However, TAIWAN currency is devalued, which helps CUBE as VCD chips are made there. Overall, the situation is favorable to CUBE. KW

To: William T. Katz who wrote (24262)	10/23/1997 11:46:00 AM
From: Stoctrash	Read Replies (1) \| Respond to of 50808

William....you be on the right track. As long as their economy don't fall totally outta bed, it could be a positive. Also note, that "The Man", John Hagedorn, forcasted in the conf. call that CUBE's tax rate should decline and hold that level for the next few years as more operations are moved overseas. & Kelvin has a good point about China's currency being tied to the US$

To: William T. Katz who wrote (24262)	10/23/1997 12:03:00 PM
From: DiViT	Respond to of 50808

Creative aims higher with PC- DVD products... Cindy Koh ÿ 10/23/97 The New Straits Times The New Straits Times Press Computimes; 2* Page 10 (Copyright 1997) ÿ CREATIVE Technology Ltd of Singapore, already doing well with its multimedia offerings, expects to increase its market share with the release of new PC- DVD products. Creative's vice president/general manager for Asia-Pacific Low Chee Seng said the company sees a huge potential in the digital video disk ( DVD ) market for the next three years. He is confident that sales from DVD products will contribute significantly to the double-digit growth being experienced by Creative. In the last financial year, the company recorded a growth of between 10 to 15 per cent, mainly from the sales of its Sound Blaster range of audio cards. Creative expects its latest PC- DVD Encore, with natural upgrade feature and interactive audio and video capabilities, to provide users with a different entertainment experience. According to Low, the company believes that the DVD player will attract a bigger user base as more large-capacity consumer and interactive titles hit the market. He added that the corporate sector is also targeted as the DVD can be a cost-effective solution to their storage problems. According to a report from the Consumer Electronics Manufacturers Association, approximately 150,000 DVD players were sold by August this year. The number is expected to increase to one million units by year-end with 8.2 million units in 1998 and 10 million units the following year. Low said based on this, Creative sees a good opportunity to make inroads in the DVD market and is taking aggressive steps to offer more value-added products to consumers. " DVD is compelling to content providers as more data can be stored. The market acceptance of DVD is increasing, and we intend to have a bigger market presence through our business strategy," Low said in a recent interview in Singapore. According to Low, Creative is keeping its business strategy simple with plenty of promotions worldwide. "Having strong manufacturing capabilities, strong brandname and strong distribution channel are some of Creative's strategies in ensuring success in its business endeavours," he said. Creative, according to Low, has learned its lesson from last year when too much emphasis was placed on the production of CD-ROM drives. The company plunged into the red when the market crashed. Creative, however, is recovering by refocusing its strategy on a new line of SoundBlaster products. It is now producing about 60 to 70 million units of the popular Sound Blaster for the worldwide market. "Our chairman and chief executive Sim Wong Hoo termed the down period 'baptism in blood'," Low said, adding that it was a blessing in disguise for Creative to re-focus on becoming a global player in the multimedia market. He said the company is also continuously upgrading its research and development (R&D) facility in order to improve its product line. "We want to ensure that our customers can continue to rely on the quality of our products." "We are also working with our competitors in what we call 'co-opetition' to create synergy for the product line. This will put us (Creative and competitors) in a win-win situation where the users will benefit in the end," Low said, adding that Creative does not consider any of its current competitors as a threat. Low however stressed that Creative does not intend to rest on its laurels. "If you are a follower, you can't go far. We are always looking to expand into other areas which can complement the PC," he said. "For now, we are focusing on bringing more quality DVD products to the market."