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Technology Stocks : LSI Corporation -- Ignore unavailable to you. Want to Upgrade?

To: patrick tang who wrote (14748)	9/3/1998 4:58:00 PM
From: shane forbes	Read Replies (1) \| Respond to of 25814

Patrick: You are right about the capacity at 0.25 issue. However a lot of the Far East companies are looking at the foundry/IP model as a very viable alternative. Cadence and their ilk provide the missing link and it is I believe a good model going forward. Those foundries are also large enough to build up sub micron capacity. Remember a few years ago they used to be several generations behind the traditional ASIC vendors, now they have caught up and perhaps surpassed. I think one of them is readying plans to play at 0.18. What is appealing in these relationships is that a lot of smaller companies (companies or OEMs that LSI won't do business with - remember LSI has those relationships with Wyle etc to address the smaller OEMs) can now enter businesses that were not available to them in the past. LSI would not look at Jo Blow if Jo Blow were a tiny company. LSI picks the big OEMs as 'partners of choice'. [LSI should really be a CSIC company now not an ASIC company. That is passe...] I don't really believe the larger companies will go the foundry/IP vendor model (at least for now) mainly because of this issue. Also the bigger OEMs want to have capacity available when there are shortages because that is precisely when they make their big bucks. Therefore this is an advantage to the vertically integrated companies (such as LSI). But I also have to agree that bigger is better and only with Symbios do I have a sense that LSI has hit critical mass. Therefore even though I am hesitant to have LSI beyond 3-4 years I do believe that the Foundry model is still a tad early to get too worried about at this stage. Nevertheless it is interesting for Erica to finally put it down in writing - almost like a death knell. As mentioned earlier - design wins are the vindication of the prowess of a company's technology. I think LSI continues to do very well here and so for the immediate future (3-4 years) I am not too concerned. shane.

To: patrick tang who wrote (14748)	9/5/1998 3:18:00 PM
From: Jack Whitley	Respond to of 25814

<<In this view, LSI will be nicely positioned. I still like this company, the only thing that worries me is the stock market will tank and take the whole economy with it. IMHO, I think we have hit bottom for international economic crisis. But if US tanks because of the stock market, all bets are off. I hope the Feds will take this stock market drop seriously.>> Patrick, Thanks for this insight. It is very helpful considering I just joined this club in mid-August at (ouch) 19 and change. There was an excellent analysis of chip prospects (and LSI) in the most recent Gilder Technology Report that echoed some of the thoughts in your post. In regard to your concern regarding the whole market tanking, I agree. I would be less concerned if we were not tanking heading into another problem that the Fed will have even less control over, Y2K. jww