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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: gnuman who wrote (43096)	12/22/1997 5:43:00 PM
From: Road Walker	Respond to of 186894

Mary and Gene, What would GM sell for if the gross margin was 60+%? John

To: gnuman who wrote (43096)	12/23/1997 2:55:00 AM
From: Joe NYC	Read Replies (1) \| Respond to of 186894

Gene, . How much would GM be worth if they owned Ford, Chrysler,Toyota, Nissan, Honda, Volkswagen, Volvo, Fiat, Peugot, Renault Mitsubishi, Subaru, Hyundai, etc? I don't think Intel would be satisfied. Because there would still be Isuzu, Rover and Hummer making cars and maybe some money. Probably a lot since they could set the prices. So why didn't Intel set the prices? Intel does set prices. Prices of AMD and Cyrix are irrelevant, since their market share is small, and they are already making as many chips as they can. AMD/Cyrix at this time can't respond to opportunity they would have if Intel continued their standard pricing model. At this point, the short term goal is to minimize the profit AMD and Cyrix can make, and it is achieved by keeping the prices of products that have competition a lot lower than if there was no competition. It's working. Neither AMD nor Cyrix are making any money. The short term cost of this are ASPs that suck and flat earnings. The long term goal is to establish tighter monopoly over the market, so that no-one can offer a competitive product. Guess what would happen if AMD and Cyrix were allowed to make profit. They would invest most of the profits in R&D and process technology. They would close the gap in process technology Intel enjoys, increase capacity and market share. Guess what would happen to Intel stock price then? So don't panic. Intel is firmly in charge. If Q4 sucks, it's part of the plan. If Q1 98 is below Q1 97, the same thing. If the stock goes to $50 or even $40, it is only a small price to pay for the long term goal, that is for Intel to have absolute monopoly. If you hang around long enough, you may enjoy the fruits of these efforts. Joe