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Technology Stocks : The New QLogic (ANCR) -- Ignore unavailable to you. Want to Upgrade?

To: Nine_USA who wrote (19792)	12/15/1998 1:42:00 PM
From: J Fieb	Read Replies (1) \| Respond to of 29386

At least they can't hi-jack the standard? Nice SGI interview with Greg Estes, director of marketing for the entertainment division, upside.com A few good paragraphs..... Moreover, all seven of the 1998 Oscar-nominated effects films used Silicon Graphics hardware or software in some variation. No matter how you cut it, or which product is encroaching on its dominance, SGI is still the platform of choice for producing professional effects in film Estes stated that SGI's entertainment group plans to heavily defend its traditional Hollywood stronghold (film and post-production) while moving heavily into the broadcast industry to achieve higher revenue growth. "We'll do more news editing, on-air graphics, and real-time image processing and analysis for events like the Superbowl," Estes said. "We're leveraging our existing relationships to enter the broadcast market. And we have a competitive advantage: Our platform is the only one that supports all 18 HDTV standards." Sound strategy. SGI's growth in the broadcast and cable industry, propelled by technologies like HDTV, enhanced TV and its digital entourages, will likely boom. Eventually (when consumers decide that digital TV has something good to offer them, other than higher monthly cable bills).................... Interestingly, SGI's big competitors are not companies like Sun or HP. "They're overseas black box vendors with closed architectures like Quantel (makers of Paintbox). With these black box architectures, you animate in 2D by hand. Customers have this choice: Use SGI or animate by hand. SGI's success in the past five years has been driven by coming out with powerful open-architecture platforms to compete with these closed-architecture platforms. We don't want to be a black box revenue company. We're the high-end performance player against the high-end closed architecture." ......... "When professional-quality tools started showing up on PCs, that's when media perception about SGI's role started to change. Now there are high-end PCs like Intergraph on the market. And the general press consensus seems to be that we allowed ourselves to be positioned by our competition. But these PCs, once you add in the plug-ins you need, end up costing about $40K, for a PC! SGI's Octane is only $22K. Press release buzz has driven this part of the industry--but there's nothing underneath it. Only more press releases. Everyone's still using SGIs." I agree that high-end PC performance is still mostly vaporware, but media perception holds great sway. And if the media keeps saying that SGI is dead and stuck in the high-end, and pumping up stories that insist that high-performance PCs are a-comin', then SGI had better correct that perception. Now. Before the PR hype becomes God-ordained truth (as so often happens). As for the bottom line, if Estes is right and everyone's using SGIs, what can the company do to increase profitability? "We need to get our expenses in line, circle the wagons and concentrate on our core areas. Digital media and entertainment is clearly one of these areas. We will have continued investment in this area from the company--we have a long-time investment in the marketplace." SGI also needs to eradicate any remnants of its hubris--the nasty corporate quality that got it into trouble in the first place. Nothing like a dose of arrogance to blind a company to external market changes and internal decay. In addition to its traditional hardware and software platforms, the entertainment unit is pushing hard into evolving arenas like digital asset management. SGI has introduced a media asset management tool called Studio Central (that targets studios) and a media server product called Media Base (built by leveraging the streaming media experience the company gained as a technology partner on Time Warner's Orlando field trials). And SGI's releasing its own high-end PC, supposed to hit the market this fall, to compete with offerings from Intergraph and NetPower. "We're focusing on what we're good at--providing powerful digital media solutions and building strong customer relations." The rest, as they say, will be up to the market. SGI's entertainment division is buffing up to fighting form. Its market share loss seems to have taught it a valuable lesson. Let the healing begin. .........................make sure to read the rest of the interview.. + Philips talk with SGI's SAN announcement.... Film image data is the lifeblood of high-end post production. Ensuring data availability and integrity is essential to business survival," said Steve Russell, marketing manager, film imaging products for Philips DVS. "Our applications demand flexibility, so ways to consolidate storage, reduce storage management overhead, and ensure that vital film image data is safeguarded are critical. Our customers look to Silicon Graphics and its partners to provide leading technologies such as Fibre Channel-based switched fabrics to address the requirements of digital media and enterprise SANs." It would be great to see an ANCR switch at the heart of many Digital television studios!