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Technology Stocks : The New QLogic (ANCR) -- Ignore unavailable to you. Want to Upgrade?

To: George Dawson who wrote (13599)	1/13/1998 1:32:00 AM
From: Kerry Lee	Read Replies (1) \| Respond to of 29386

(CRYSTAL BALL on OEM's) To the thread: I have received a number of e-mails in the past weeks from various people regarding OEM's, especially SUN. Please do not send me e-mail asking me who is going to win Sun or any other OEM because I do not know and if I did I would not respond via e-mail to any anonymous screen name/alias on MF or SI. There are in the neighborhood of 3-4 "Tier 1" OEM's up for grabs and probably double that in the "Tier 2" OEM category. My best guesstimate is that the "Tier 1" OEM's each represent approx $15-30 million in annual revenues ( to the FC switch company ) and that the "Tier 2" OEM's are substantially smaller annual revenue contracts, ie $3 - $10 million apiece. I am assuming that the above run rate for revenues is applicable for "Year One" of each OEM's ramp-up ( eg, July 1998- June 1999 ) and that the sales would double in Year 2, etc..If anyone has different thoughts/info, feel free to post your data/arguments. I do NOT know who will win the SUN FC switch contract, however if I were to handicap the "Sun OEM game" in a similar fashion as a bookie establishing the point spread on the Super Bowl, based on the info available, I would make Brocade a slight favorite to win Sun, ie by a field goal. Early in 1997, Brocade got off to a seemingly insurmountable lead ( 3 touchdowns ) , however, the launch of MKII got Ancor back into the game in the late summer to the point where the game was tied in the fourth quarter. I am personally frustrated that Ancor did not land a knock-out blow to Brocade in Q4 when they had Brocade on the ropes with no arbitrated loop available. The Sun game is now into overtime ( 1998 )... I would be disappointed if Ancor does not win Sun, BUT I would not be shocked by Brocade winning it since they have several factors in their favor: 1) Two of Brocade's major investors are the co-founders of Sun ( Bill Joy, Andy Bechtolsheim ) and I hear that they still have influence inside Sun ( eg. Brocade has recruited many ex-Sun personnel, especially engineers ), 2) one of Brocade's co-founders is ex-Sun and 3) Brocade has the geographic advantage of being in Silicon Valley . I am convinced that Ancor has the superior product design and lower cost design ( eg. 4 ports/ASIC translates to 4 chips in a 16 port Ancor MKII switch versus 11-14 chips in a 16 port Brocade switch ) ,however it remains to be seen whether these factors are sufficient to overcome the "X" factor, Andy B. On a separate but related issue, Sun awarded their FC hub business to Vixel ( Redmond WA ) instead of Gadzoox ( Silicon Valley ). My guess is that the Gadzoox box had some network mgmt features that made their box more expensive than Vixel's and Sun went for the cheaper Vixel hub. Many industry pundits had predicted Gadzoox would "dominate" the FC hub business based on their blueblood VC backing , Seagate minority ownership and their Silicon Valley predigree of engineers..Despite the Silicon Valley pundits, Vixel has now won both CPQ and SUNW. Perhaps Ancor will surprise the skeptics and Industry pundits in the next 1-6 months ..there's alot of Industry insiders who are impressed with the design/performance of MKII...how many OEM's and revenues this translates to in the next 6-18 months, I can only speculate like the rest of us. I believe the recent $3-6 trading range discounts the anticipated lousy Q4 and assumes no new OEM deals ..I love the upside to this ridiculously low market valuation because in an industry like FC which is based on open standards ( as opposed to proprietary like Windows OS ), it is unlikely for just one company to dominate /win all the business unless it controls the sales channels all the way to the end users.

To: George Dawson who wrote (13599)	1/13/1998 1:46:00 AM
From: JOE 6PACK	Read Replies (2) \| Respond to of 29386

George, Maybe she will also give a discertation on "How to have great technology but not be able to sell any of it!" Sounds to me like this company is an employee factory and eventual graveyard for networking technology. I've just about had it with this peice of shit company and their grand plan of networking nirvana. I don't know how Kerry and Co. can deal with this continuous nonsense. Unfortunately, there's a good chance that they will be put out of their misery due to this company's lack of funding. If the damn switch is so great, why do they seek financing through such absurd, unconventional manners (including a Sheik?). People should be throwing money at them. Maybe it's just my lack of insight but I sincerely doubt it. Lastly, we need not use that silly e-mail to confidentially exchange information, as the SEC is not going to investigate losses incurred by bad trades. '98 should be a real "scorcher", Joe