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To: MONACO who wrote (68150)	11/9/1998 9:10:00 PM
From: Z268	Read Replies (3) \| Respond to of 186894

Monaco, This excerpt is from Barron's on line gives one view on the topics of processing power and bandwidth: interactive.wsj.com (for those with access). It is worth reading the article in its entirety. Steve ------------------- Landis: If you focus on IT spending, that's a very old way of looking at end markets. With the possible exception of E-commerce, that's not where the world is going. It's not so much about computers as it is about connecting. It's not about MIS departments; it's about consumers. McNamee: The world used to be about processing power. In the early days of mainframes, processing power was a scarce resource. Everything was optimized to maximize the productivity of the processor. You had air-conditioned rooms, manned by folks in white lab coats, protecting the computer from users. PCs came along and reversed the polarity of the system. You gave the end-user processing power. Then along came the Internet, and suddenly you had this reversion to a centralized model. Q: But not the same centralized model. McNamee: Processing power still matters. There are graphics applications, for instance, which really reward you for more processing power. But at the margin, what matters is bandwidth. People use computers to communicate more than to calculate. You're seeing a reallocation of budgets away from raw processing power and toward things that enhance communications. Cisco is a direct play on that. Intel is not. Q: No? McNamee: Intel is trying to reposition itself to be a bandwidth player, but the reality is that Intel's success was driven by a monopoly franchise in processing power. It's going to be hard to find an economic model as compelling as that in the bandwidth world if you're Intel. That doesn't make Intel a bad company. It's just that the system is shifting. Q: Processing power matters less than bandwidth. McNamee: I'd say the two are now on the same stage together. Q: But the balance seems to be shifting. McNamee: Before, it was 100% processing power. That was the story in mainframes, minicomputers and PCs. You always wanted to upgrade as rapidly as you could to the next processors, because whatever you had before was obsolete the day you bought it. Today, Intel is struggling to find something that actually needs a 400-megahertz processor. Video games do. But it's hard to find anything in an office that requires it. Landis: Bandwidth is where there's scarcity, and therefore opportunity.

To: MONACO who wrote (68150)	11/9/1998 11:49:00 PM
From: Paul Engel	Read Replies (4) \| Respond to of 186894

Monaco - Re: " Intel and all of its high speed processors (could they sell them fast enough)or do the two(broadband transmission and Intel) not relate....M " The fact that the Internet bandwidth is comparatively slow - vis-a-vis Intel's CPU speeds is often tossed out as a reason that FAST CPUs are not useful, nor required. To a large extent, this is baloney. It assumes that a PC/CPU is used ONLY for internet access and that it is using only ONE BROWSER window and NOTHING ELSE ! Most people can, and do, use several browser windows at one time, and often employ other programs running concurrently with the browser. Many PCs are generally used for many other tasks that ARE CPU intensive - graphics display, database searches, spreadsheet calculations, etc. The most compelling argument for the importance of CPU speed is the rapid rate EVERY CPU MANUFACTURER (Cyrix and IDT are two exceptions) are busting their buns at INCREASING CPU SPEED. CPU performance SELLS - it is in very high demand - and NO CPU company is advertising that their new SLOWER DESIGNS will be on the market soon. Paul