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Technology Stocks : S3 (A LONGER TERM PERSPECTIVE) -- Ignore unavailable to you. Want to Upgrade?

To: JerryP who wrote (11425)	7/8/1998 1:34:00 PM
From: ECAC Hockey	Read Replies (3) \| Respond to of 14577

<< This investment would be a big mistake ONLY if you lose money. What I'm interested in hearing is, what was learned? >> Plenty was learned. Mainly, the dynamics of the graphics chip industry stink. The barriers to entry are too low and product cycles too short, thus leading to constant pricing pressures and excess competition. Graphics accelerators are a commodity product and there is little that S3 or anyone else in the industry can do to add value to them. S3's product is not much better or worse than anyone else's in the industry, thus margins will perpetually be under pressure. The only time S3 can make decent money is during occasional periods of fab undercapacity and high demand, a short-lived condition that the marketplace will quickly correct. That is what I have learned from owning S3 and I will not again make the mistake of investing in a company in an industry such as this again.