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

To: Mike Winn who wrote (2350)	1/13/1998 11:29:00 AM
From: Michael C. Woodward	Read Replies (3) \| Respond to of 60323

SANDISK RESPONSE - 1/12/98 Response to questions back in December 1997. I noticed in my E-mail that the SanDisk senior staff receives copies of our questions and responses to the questions. I have been asked to add the following to all future responses to SI by SanDisk. "The matters discussed in this response contain forward looking statements that are subject to certain risks and uncertainties as described uder the caption 'Risk Factors' in the Company's annual report on Form 10-K for the fiscal year ended December 31, 1996, and quarterly report on Form 10-Q for the fiscal quarter ended September 30 ,1997, filed with the Securities and Exchange Commission. The Company assumes no obligation to update the information in this response." Questions: 1. From Ian Wilder Q What developments are there for the music industry (e.g. small mobile "Walkman" type device capable of replaying and recording)? A CF is making inroads today into the voice market. We believe that in 1 to 2 years CF will replace tape in high end voice recording and dictation devices. For music, it takes approximately 30MB to store 30 minutes of stereo quality music. We believe that both CF and MMC will attain the requisite price structure in the next few years to be a player in the music market. 2. From Alex Go Q How are store and channel sales going? Will SanDisk be able to recognize some revenue during the fourth quarter as a result? If so, how much? A We are currently in a quiet period and cannot comment on the current quarters (Q$'97/Q1'98) until after our earnings release on January 21st. 3. From Alex Go Q On 2/26/97 an Administrative Law Judge of the ITC issued an initial determination which found that Samsung infringed claim 27 of the 338 patent in all its Nand flash memory products, including the Samsung 4mbit, 16mbit, 32mbit and 64mbit Nand chips and memory cards built with same. SmartMedia is based on NAND gates so doesn't this mean that SanDisk is getting royalties from SmartMedia sales? A SmartMedia is covered under the cross-license agreement with Toshiba and Samsung. The terms of these agreements are confidential. 4. From Alex Go Q There is an advanced industry in "Smart Cards" (i.e. credit cards that contain up to 1/2 Mgbt of personal credit card information). A CF is not a player in this industry today. The highest capacity flash chip used in Smart Cards is well below the lowest capacity of CF. 5. Steven Wildt Q It is the perception that competition in the flash disk market is going to squeeze SanDisk profits. Is this valid? A We are currently in a quiet period and cannot comment on the current quarters (Q4'97/Q1'98) until after our earnings release on January 21st. I don't like that response