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To: Ed Beers who wrote (36482)7/27/1998 2:40:00 PM
From: Taro  Respond to of 53903
 
Hi Ed,

do not completely forget, that the fixed (capital) costs sky-rocket with the new equipment upgrading procedures necessary to shrink to finer geometries and thus more die output per wafer. If you can sell all of the vast new capacity, then you are fine. If not, however, your increased capital costs kill you, while you are dumping yr product to (or below!) the variable production cost per device. In short, this is what happened to ROK Inc.!

bst rgds

Taro