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

To: BigBull who wrote (7599)	3/29/1998 6:41:00 PM
From: Sowbug	Read Replies (1) \| Respond to of 11555

Thread, I tune in and out of IDTI, so I apologize if this has been covered: A big difference between the 486 and the Pentium was the floating-point unit. I believe id Software's Quake wouldn't have been possible without the speedy FPU, and Quake was, to an extent, a killer app (i.e., a program that itself justified the purchase of a particular machine). Assuming this is true, then a fast FPU is an essential component of a full-featured consumer PC. I understand that the WinChip, like the AMD K6, has a relatively rotten FPU. Would one of you be so kind as to enlighten me as to the correctness of my understanding, and to tell me what the future holds for IDT's FPUs?

To: BigBull who wrote (7599)	3/30/1998 12:04:00 PM
From: Rob S.	Read Replies (1) \| Respond to of 11555

I agree with your points but can't bridge the gap to this making IDTI an attractive acquisition for IBM. IDTI does not own the development aspect of the MIPS technology they now sell. They were dependent on QED for the design and now that the QED relationship has soured, they are not the premier source for fresh designs. Sure they can continue to sell the products they have on the shelf or try to compete against QED and others for new designs, but I don't think that they can turn over world class competitive designs for future boxes. IDT has yet to demonstrate the ability to go beyond the QED dependency. So that potentially leaves a vacancy of leading design talent within IDT. What do they do? Go to QED to contract fresh designs? Sure they own a minority interest in QED, that does not allow them to prevent QED from competing against them. The return to IDTI shareholders is questionable at this point. QED will likely return good profits to the directors and managers but how much of that filters down to the minority owner or how much impact that will have on IDTI's bottom line is not known. QED is a fabless company that can utilize the best and cheapest capacity available - not necessarily that of IDTI. I'd like to hear what management says about how much of the pie gets put on IDTI's shareholders table.