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To: rich evans who wrote (194)	10/27/1998 3:22:00 PM
From: Sun Tzu	Respond to of 10711

OT (kinda) -- A word about the world of semiconductors Rich, Investing in semiconductors is not any different than investing in anything else (except biotechs and internets perhaps). You look for the same things here that you should look everywhere: how dominant is the company, what's the banalce sheet like, what is the competetion up to, what are the bariers to entry and so on. The problem is that most people don't understand the changing nature of technology and thing that hot new chip constitutes a barrier to entry. This problem mostly ails the non-techies. The other problem is that many people mistake a great technology for a great business. This problem mostly ails the techies. I have no silver bulets here but to say that ignore the purely technological aspect of the company and treat as you would treat any manufacturing company. Now let's talk about the other issues that often bugs people in high tech, like the ones you say you worry about. If there is one thing constant in computer industry, is that it constantly moves between super specialized and fully integrated polls (as well as analog and digital polls). Neither side will ever win. The evolution of the machine language as a RISC (though the term did not exist then) to CISC to RISC again to VLIW (which is now the leading technology and the prime candidate for Intel's Merced and is really a form of CISC) is a good example of this. But over all, it seems that the specialized designs win over the general or integrated ones. This is not because the integrated solutions are not as good, but rather because the manufacturers can make more money if they can sell you your car by parts rather than as a whole. I hope this helps. Sun Tzu