Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: James J. Cramer who wrote (19055)	10/26/1997 3:52:00 PM
From: Lee Martin	Read Replies (1) \| Respond to of 61433

Hi James, I posted my analysis of the "big picture" re: PC's, the internet, and why I think INTC should buy ASND a while back and got no response. Maybe you can take a look and tell me if I'm way out in left field or not. Some observations: 1. The emergence of the sub $1k PC (40% market share by some est.) indicates that the need to buy the latest fastest processor no longer exists. Advances in hardware have out paced the needs of the software. In other words, we just don't need all that power. 2. Intel has identified the internet as one of the key drivers for PC demand. Andy Grove has spent millions investing in private startups, software co's., etc. that are developing technology that promises "to enhance the internet experience" by increasing its capabilities, ease of use, performance etc. 3. The fact is that none of these new applications can function on the internet as it exists today because the speed of the backbone is only about 40 kbps, much too slow to move the huge volume of data required to make these great new processor hungry apps. a reality. 4. So until the internet backbone gets upgraded to make all these "vaporware" apps. possible, the consumer is going to stay content with his old PC, and Intel is going to be sitting on a lot of high end chips, wondering what happened to demand. Solution: 1. Intel is always looking for new markets for their high end processors. Why not the internet backbone ? It needs all the help it can get. Intel is already extending its reach beyond the PC by offering network adapter cards, LAN hubs, switches etc. but has yet to step into the internet backbone market. 2. ASND has all the cutting edge tech. required to upgrade the backbone (ATM and frame relay switches, routers, and remote access servers). If Intel bought ASND and stuffed all of their products with Intel's latest processors, the speed and functionality of these devices would take a huge leap forward. Since ASND would be using standard mass produced processors, the cost of their equipment would drop. 3. Once ISP's etc. see the increased performance/cost ratio of the "Intel Inside" products from ASND they will want to upgrade their existing systems to take advantage of this new technology and enable their network to handle all the new "killer apps" being released by Intel. 4. Everyone talks about an "end to end" solution. With "Intel Inside" from the PC to the internet backbone how much more end to end can you get? 5. MSFT is branching out into cable, why can't Intel get into the internet backbone market ? In summary, I think Intel is waiting for someone else to take the lead and upgrade the internet and spur demand for their high end processors. Since they have as much or more at stake here than any other high tech co., they need to be the one to step up to the plate and make it happen. ASND would give them the tools they need to accomplish this goal. Whaddayathink ? Thanks in advance, Lee PS- tell Maria next time you see her that I think she's sweet !