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

To: Bobby who wrote (1684)	11/18/1997 4:35:00 PM
From: Mike Winn	Read Replies (1) \| Respond to of 60323

Excellent article. I hope that Sandisk will not remain a fabless SIP but will have its own foundry to make the chips. Actually I don't mind if it remains fabless as long as the stock can get the valuation of Rambus. Can you believe that Rambus has a 45% larger market cap than Sandisk (after RMBS had crashed) even though the company barely makes any money? See: quote.yahoo.com and quote.yahoo.com

To: Bobby who wrote (1684)	11/21/1997 11:28:00 AM
From: Mike Winn	Respond to of 60323

More on SIP. ============================== The Semiconductor Intellectual Property Industry October 13, 1997 (38 pp.) Hambrecht & Quist Research The growing availability of deep submicron semiconductor fabrication processes will enable electronic systems companies to design true systems on a single chip -- multi-function ICs that include CPU, memory, networking, communications, graphics, and specialized functions on one piece of silicon. The great news is that system-on-a-chip designs will enable a significant improvement in system cost, speed, function, and power consumption, leading to lower system prices, larger existing markets, and the promise of new markets. The challenge comes from the added complexity in chip design, which complicates the design process, creating what we call the deep submicron design gap. The tension between greater chip complexity and increasing pressure to reduce time to market requires a change in the approach to chip design. The design re-use of semiconductor intellectual property (SIP) can close the design gap, resulting in successful designs of complex systems-on-a-chip that can be completed in a shorter chip design cycle time. Today's SIP market is primarily captive, held within traditional semiconductor manufacturers, fabless IC companies, and ASIC companies. We estimate the merchant SIP components market will grow from under $1 billion today to about $6 billion over the next four years, served by both public and new emerging private companies. We expect the SIP market to migrate to a merchant market as the vertically integrated chip companies begin to source design elements externally in order to meet time-to-market and industry standard requirements. This demand for merchant SIP will create market opportunities for well-positioned companies. We expect successful companies to excel along three key vectors of SIP value: (1) performance differentiation, (2) the customer "pull," and (3) industry standards. Early merchant SIP entrants will have the greatest ability to generate the momentum needed to succeed along all three vectors. The relatively few SIP companies that succeed along all three vectors will offer the most attractive investment opportunities. We anticipate these companies will be able to demonstrate high rates of revenue growth, defensible market positions, and very attractive financial models that include recurring revenue streams. SIP will have an impact on the broader semiconductor industry as well. With increased availability of licensable and standard SIP components, we expect the traditional semiconductor foundries, who have leading-edge process technology, will move up the semiconductor value chain and become more full-service, ASIC-like chip suppliers. At the same time, we see traditional ASIC suppliers as having the opportunity to use their integration skills and valuable captive IP to become both merchant SIP suppliers and integrators.