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Technology Stocks : IDTI - an IC Play on Growth Markets -- Ignore unavailable to you. Want to Upgrade?

To: Hippieslayer who wrote (7461)	3/19/1998 10:28:00 PM
From: Samuel R Orr	Read Replies (1) \| Respond to of 11555

The article on where chips are headed was an excellent tutorial that helped bring me up to date a bit. Your question about IBM buying IDTI and manufacturing the C6+ to compete head-one with Intel brings up a possibility, but most likely a very small one. The inclusion of copper metal technology to increase processor speed would have to be answered by a real technologist. Many years ago, when I started with Bell Labs, there was something called copper poisoning that prevented processing engineers, of which I was one, from using copper. Aluminum, with its reduced electrical conductivity, was selected because it was a reasonable compromise that worked. I'd like to know just what IBM has patented, the line dimensions they can employ, and many other details of copper metal. Being skeptical of marketing claims never hurts. For instance, can they make multi-layer metals with sufficiently narrow line widths using copper? The other parameter of the C6+ as made by IBM is it is a 2.5V technology. How much of the associated logic and memory chips will work with 2.5V? TTL used to be a 5V system, and it has been modified to run using 3.3V. As transistor line widths move down to .25 microns, the channel oxide thicknesses also scale down, and they won't tolerate 3.3V. That's why a 2.5V supply has to be used, but all the components must work with 2.5V. The computer I'm using probably wouldn't run with 2.5V, and there are design problems in trying to mix voltages. The important conclusion of all this rambling is that the C6+ may not be a drop-in replacement for the C6. I'd like to know the answer to that question. Some things may be apples to oranges. IDTI's C6 could gain acceptance in sub-thousand dollar computers, but it is not designed to be competitive with the larger die, more complex Pentium II microprocessor at the high end. Would IBM use the C6+ to enter only the low cost computer market? Perhaps. I don't care what you smoke, Fugazi. I just want to know if you inhale!

To: Hippieslayer who wrote (7461)	3/20/1998 11:22:00 AM
From: Rob S.	Read Replies (1) \| Respond to of 11555

Intel rolled out their line-up of Celery (sic) PIIs at CeBit '98 and plans very aggressive pricing. At the same time they introduced beta versions of the Merced chip and test stage systems. Intel plans to hold off the competition against the mainstream markets with neutered PIIs at deep discounts and move more agressively into the server and enterprise computing environments with the Merced. Merced will be the next big step for Intel because it is designed for distributed multi-processing like no other main stream uP architecture has before it. It will offer tremendous advantages in power and flexibility for high-end applications. Intel, Microsoft, HP, IBM, DEC, etc. have put a lot of effort in getting developers behind the new architecture. Intel announcements are bound to overshaddow IDT's over the next few months. "How can IDTI compete against the pricing and marketing strategies of Intel?" This may put pressure on IDT's stock price. The thing to remember is that IDTI is not dependent upon the C6 or any other single product to show significant improvements in sales and earnings. And IDTI "has nothing to lose" in pursuing the new markets it has ventured into. Coming from the structure of having developed these technologies at very reasonable cost compared to it's competitors, IDTI does not have huge debts to pay off nor is in the position of having to sell parts for less than it costs to manufacture and market them as is AMD and Cyrix (M2, the MediaGX is profitable but doesn't make up for the losses on M2). I think it is quite possible that IDTI will see a drop in price this summer if analysts and investors fear the threat of Intel's stumbling, monopolistic pricing tactics in low-end uPs. This is hypothetical thinking. IDTI could continue to move up past the 16 level of resistance if they have good news on sales and earnings or show that they are achieving high yields and production rates for the C6. Clear Logic is achieving good trade press and early acceptance but is not expected to contribute more than $20 million to sales in the coming year. It will be another two or three years for that puppy to grow significantly. The news that will move the stock higher will be things that convince the market that earnings will be higher than current expectaions. So, IDTI needs to perform better than currently expected for it to move up, IMO. That is not going to be an easy thing to demonstrate in the next two quarters. Over the next six months, I'd guess that the chances of moving solidly past 17 are about 25-30%, of moving within a range between 13 and 17 at about 35-40% and of moving down below 13 sometime during the period at 25-30%. Just my ramblings.