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Technology Stocks : 3DFX -- Ignore unavailable to you. Want to Upgrade?

To: Jeffrey P who wrote (9667)	12/15/1998 3:36:00 AM
From: Jeffrey P	Read Replies (2) \| Respond to of 16960

I'll toss my $.02 in favor of the STBI/TDFX deal. I have been under the impression that OEM deals have been hampered by unease concerning how TDFX will support OEM wins. So what do they do, go out an buy the OEM experience and cut off a very nice channel for what I feel is their most dangerous competition. I really like this deal. Pro's: 1) Channel stability. I for one did not like hearing that Diamond canceled a large V2 order in the Q3 CC. Glad to see them go but also feel that the bad blood ( zdnet.com ) between these two companies has just begun. Although I did chuckle when I read " STB is in trouble. In the gaming segment, Nvidia and 3Dfx have been neck and neck, and we feel Nvidia is ahead now. ". heh... still laughing, but what WOULD you expect them to say. 2) Smacked nVidia. Think back over the last 12-18 months and all the STB riva OEM wins. I like the fact that TDFX has cut nVidia's OEM supply line, and I would bet that they had OEM blessings for this whole scenerio. And I really like the tight relationship that STB has with Dell <grin>, the crown jewel of OEM in my book. I am curious how the 3 million that STB loaned to nVidia will play out, off the top of my head the deal had a set repayment date and a provision for stock repayment in the event the nVidia IPO went through. 3) Voodoo3 name makes significantly more sense now. Think about it. Voodoo2 sales caused Diamond to have there single best quarter in their history (2nd was it?). V2 tops in retail sales positions per pcdata (www.pcdata.com). If I was going to drop this "bomb" and was going to make v3/banshee2 a proprietary chipset for my own card manufacturing division, your damn right that I'm going to milk name recognition to it's fullest. 4) STB OEM experience. What can you say, speaks for itself. Cons: 1) Backed Diamond, Creative, and nVidia into a wall. You know what they say about cornering a nervous dog. This definitely upsets the status quo and it should be very interesting to see who picks up nVidia. 2) New direction for TDFX. You had to expect this was coming. Can TDFX execute, trim the operation of STBI, and keep a firm (FIRM) hold on channel supply and demand. ... more cons... i'm just to tired to write any more... Overall, I like it. Night all and good luck tomorrow! Jeff P.