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To: Clint E. who wrote (15199)	2/1/1998 4:50:00 AM
From: Johnny Canuck	Read Replies (2) \| Respond to of 68046

Clint, My one concern for VTSS is that its manufacturing costs appear to be higher than those of its competitors. If they need to switch to lower cost/high volume products to keep earnings growing they won't be able to make the transistion. I not sure how long they can keep their share of the telecommunciations infrastructure business. Do you have any insight to what their specific competitive advantage is. From the 10K: While the Company's process technology utilizes standard silicon semiconductor manufacturing equipment, aggregate production quantities have been relatively low and the process technology is significantly less developed than silicon process technology used by competitors. This leads to overall yields lower than levels typically achieved in the silicon process. The Company expects that many of its current and future products may never be produced in high volume. Harry