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Technology Stocks : C-Cube -- Ignore unavailable to you. Want to Upgrade?

To: Ian deSouza who wrote (28886)	1/28/1998 10:25:00 PM
From: Nevin S.	Read Replies (3) \| Respond to of 50808

Unfortunately, the analysts may feel that Zoran has a more flexible business structure versus CUBE and there may be the belief amongst them that ultimately Zoran will prevail financially (I do not share this belief by the way and I own a substantial amout of CUBE). What I mean by this is that typically, software companies are able to upgrade their products faster than hardware companies, and, thus, can take advantage of new advances more readily. They can bring products to market faster and upgrade or fix them fairly easily. The biggest advantage a software maker has over a chip company like CUBE is profit margins. Margins on software are typically greater when you have some type of protected intellectual property and the operating leverage of these companies is even better as they sell greater volume of product. Zoran's most recent earnings report seems to bare this out. Technologically, I still seem to believe that hardware and CUBE is the better solution. Wallstreet on the other hand does not appear to share my belief. In the mean time I have to run to the store and get some more dog food to feed this pooch.