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Strategies & Market Trends : Graham and Doddsville -- Value Investing In The New Era -- Ignore unavailable to you. Want to Upgrade?

To: porcupine --''''> who wrote (333)	5/17/1998 1:37:00 PM
From: porcupine --''''>	Respond to of 1722

CPUs: Oversupply accelerates--good news 4 conumers; bad 4 Intel, AMD, and Mat'l Semi. RESEARCH ALERT-Merrill sees microprocessor excess NEW YORK, May 15 (Reuters) - Merrill Lynch analyst Thomas Kurlak said on Friday he sees a pronounced oversupply of microprocessors, with the personal computer market expected to grow by about 14-15 percent in 1998 and 1999. -- Specifically, Intel Corp. now has the capacity to make more microprocessors than the market needs, he said. -- "Accordingly, it (Intel) has begun to lay off workers, reduce capital spending and has delayed a major new fab in Texas," Kurlak said. -- Intel to start transitioning its microprocessor capacity from mostly 0.35 micron to all 0.25 micron by late this year. Because of the smaller die size offered by this process, potential unit capacity will increase by about 50 percent, assuming four fabs are fully operational on 0.25 micron and comparable yields, he said. -- "Clearly, the slower growing PC market cannot absorb that level of increase in supply," Kurlak said. -- Over the past year, Intel's average microprocessor prices are estimated to have declined 22 percent, he said. -- A 50 percent potential supply increase can only worsen the pricing picture, he said. -- At the same time Intel is moving to smaller die sizes, Advanced Micro Devices is ramping up its long delayed K-6 chip. In addition, International Business Machines Corp. will add its K-6 supply to the market as an AMD foundry starting in Q4. "Together we estimate K-6 production will exceed 12 million units this year and 21 million in 1999 compared to total AMD microprocessor units of 7.5 million shipped in 1997," Kurlak said. -- Also the National Semiconductor Corp. -Cyrix ramp up at its new Maine plant and at foundry partners including Taiwan Semiconductor Manufacturing and Chartered Semiconductor is estimaed to raise its microprocessor unit production to 6.4 million in fiscal 1999 from a 3.2 million annualized rate at present, he said. -- Kurlak sees cutbacks or DRAM style microprocessor price war. -- "Even something less, which looks unavoidable, would be detrimental to microprocessor producers' sales and income levels," he said. -- Intel shares closed at 84-9/16. ((Wall Street desk 212-859-1730))

To: porcupine --''''> who wrote (333)	5/27/1998 8:56:00 PM
From: porcupine --''''>	Respond to of 1722

Lawmaker says Microsoft probe may broaden WASHINGTON, May 18 (Reuters) - Senate Judiciary Committee Chairman Orrin Hatch said on Monday the U.S. government's antitrust case against Microsoft Corp. could ultimately broaden to areas other than competition in Internet browser markets. The Justice Department had acted "very appropriately" in filing an antitrust lawsuit against the technology company, Hatch, a Utah Republican, said. The lawsuit accused Microsoft of using its monopoly power to bully competitors and asked the court to stop the firm from requiring computer makers to include its Internet Explorer software for accessing the Internet's World Wide Web. "I do believe this will go beyond the browser issue. The browser issue is a significant issue, but it pales in comparison to some of the other issues," he said. If other antitrust allegations are found to be true, "then this is going to get to be a much bigger case than it is now," Hatch told reporters. Hatch said he intended to hold more hearings on Microsoft, probably in June. "I have no axes to grind," he added. "I don't think a legislative solution is the way to go, I think we ought to enforce the antitrust laws and I think that Microsoft should be treated fairly in the process," Hatch said. ((Washington newsroom, +1 202 898-8391, fax +1 202 898-8383, washington.economic.newsroom@reuters.com))