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Technology Stocks : LSI Corporation -- Ignore unavailable to you. Want to Upgrade?

To: Tom Caruthers who wrote (10191)	2/27/1998 5:03:00 AM
From: shane forbes	Read Replies (1) \| Respond to of 25814

Tom: Awhile back someone had asked about the Sony PlayStation and LSI. I'd said then that of the 3 possibilities the further out Sony pushes the new PlayStation the more I'm inclined to believe that it will be an integrated DVD machine with lots of other goodies - call it the Sony ThisIsNotYourFather'sOldPlayStation. Also the more integrated it became the more I liked LSI's chances. --- Well guess what the world is a funny place. From the most recent issue of Business Week: Betting on the hardware side of the business is tricky. No company has remained industry champion from one game generation to another. Sony is already starting to slip in Japan, where two PlayStations are sold for every N64. Sony is said to be working on blueprints for a game machine using digital video disks that would come out around 2000. Even if you believe in PlayStation's continuing good fortune, the system's hardware and software accounted for only 25% of Sony's group operating income in the quarter ended Dec. 31. To buy its stock, you must also like Sony's other businesses, which happen to be doing nicely at the moment. ---- Of course between now and Y2000 we could be all dead. But it's important that the medium talked about - DVD has close ties with Sony and LSI. Sony went to LSI to get LSI to build them the DVD player that Sony sells. LSI probably leads in game players and is at most 2nd I guess in DVD related stuff. So why wouldn't Sony use LSI's help to do the next generation Sony ThisIsNotYourFather'sOldPlayStation? Well I like our chances. --- And even if not true it would seem absurd for Sony to build a Sony 64 bit playstation so close to the Y2000. One rule in consumer electronics: Don't eat the goose that lays the golden eggs. Or put in another way don't sell a product that cannabalizes an existing product's sales unless you have a damn good reason to do so. --- Finally with 25% of income up from 0 3-4 years ago, I think Sony likes LSI's PlayStation chip. --- Shane.