Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: John Rieman who wrote (31428)	3/25/1998 4:55:00 PM
From: BillyG	Read Replies (1) \| Respond to of 50808

Wow! An MPEG-2 codec at this price point would make quite a splash at WinHEC. <<C-Cube expects to ship a consumer version of the DVx single-chip encoder and decoder in the second half of this year. Company officials are confident at least one third-party upgrade kit marketer will sell a board-level implementation of the technology for $299 by Christmas. That means the cost to OEMs for the DVx chip will be sub-$100. C-Cube also is reaching out to drive manufacturers as a potential distribution source. >>

To: John Rieman who wrote (31428)	3/25/1998 4:56:00 PM
From: CPAMarty	Respond to of 50808

A little point/counter point from yahoo mpegged kicked a_s POINT 1. C-Cube makes money from China, the VCD (MPEG-1) market When will this cash-flow drain out ? 2. Div/Comm makes money from MPEG-2 encoders, majorly from outsite of USA, why ? 3. C-Cube might not make any money from the DVB settop box 4. C-Cube may hardly make money from the DVD market, even if the consumer DVD player will take off in the Q4. 98 (it is already 18 months later, is it really coming soon ?) (the software DVD can not be used in consumer players) 5. C-Cube enjoyed the big gross margins from the MPEG-2 encoder chips (E2 and E3 chips), since they ware the only hardware IC source and the friendly R&D supports 6. C-Cube's latest E4 encoder chip may not be able to have the same level of gross margin, since IBM encoder chips and less R&D supports. In fact, there are no encoder makers believed they will have a fair competition with Div/Comm, in the encoder market. So, why waste their efforts to C-Cube based encoders. 7. Basically, C-Cube, Div/Comm, IBM are computer GUYs, such that they are lack of the basic business sense and personal connections to the satellite and cable communication / broadcasting industries. This may be part of the reasons why Div/Comm's encoders make big names outside the USA. Within USA, Div/Comm is just sub-contracted to provide encoders for system integrations. Anyone believes a US rooted company can be successful without making money within USA, the world's biggest market. If C-Cube can only make money from the commanity-kind chips from the third-world countries, its P/E may be just 10 to 15. COUNTER POINT TO: xlee00 FROM: mpegged Mar 25 1998 4:01PM EST >>1. C-Cube makes money from China, the VCD (MPEG-1) market >>When will this cash-flow drain out ? It won't. VCD strength surprised even Cube this quarter. China already test marketing Cube based DVD's. >>2. Div/Comm makes money from MPEG-2 encoders, majorly >>from outsite of USA, why ? Ever hear of DirectTV or EchoStar? They use Cube Encoders. Both are in the US. >>4. C-Cube may hardly make money from the DVD market, even >>if the consumer DVD player will take off in the Q4. Cube has already made more money in DVD this Q than forcasted. PC-DVD, as silly as it seems, will ship more units than Consumer DVD this year. Creative Labs easily has 30% of the PC-DVD market. They use Cube. >>5. C-Cube enjoyed the big gross margins from the MPEG-2 >>encoder chips (E2 and E3 chips), since they ware the only >>hardware IC source and the friendly R&D supports >>6. C-Cube's latest E4 encoder chip may not be able to have the >>same level of gross margin, since IBM encoder chips and >>less R&D supports. Margins on E4 are very nice. >>In fact, there are no encoder makers believed they will have >>a fair competition with Div/Comm, in the encoder market. >>So, why waste their efforts to C-Cube based encoders. Because E4 is so good and cheap. If Divicom is such a threat then they must be good. Cube has many more man years experience in this field than any of thier competitors. >>7. Basically, C-Cube, Div/Comm, IBM are computer GUYs, >>such that they are lack of the basic business sense >>and personal connections to the satellite and cable >>communication / broadcasting industries. Check out Nolan Daines, Tom Lookabaugh backgrounds. Tom and Nolan know these industries well. Revenue from Divicom's business will exceed that of VCD this year. Last quarter the regional revenue break down was 4% Japan, 8% Korea/Tiawan, 11% Europe, 35% US, 47% China. By the end of the year China will account for less than 40% of revenues while still growing nicely. Last quarter revenue was broken out as 46% VCD, 4% DVD, 50% Communications (Divicom). VCD continues to grow, DVD will grow. Divicom's business will prove to be the fastest growing segment of Cube's revenue this year.