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

To: Sun Tzu who wrote (9822)	12/21/1998 10:53:00 AM
From: Patrick Grinsell	Respond to of 16960

<sigh>, so your argument has changed "lack of demand" to "lack of supply". Well I think I can address that too. And that any time a major change in one aspect of the business ocures Whoa there. The combined unit is doing nothing different from when each of the separate parts worked individually with the exception of STB probably selling at a higher volume. The inefficiencies you speak of just shouldn't be there. The major retailers essentially take no risk accept a shelf space risk. If the boards don't sell or have problems, it is 3dfx that takes the hit for this. That's what price protections are all about. The shelf space risk works both way. Product managers want to fill shelves with product that are high margin and will move. Empty shelves because of lack of ordering are a bad thing. Given Voodoo2's great retail success I doubt there will be too much underorderding going on. I believe the emphasis you are placing on the "relationship" between boardmaker and retailer is waaayy overstated. Product managers don't have the time to familiarize themselves with the thousands of companies whose product they sell. Bottom line: if it sells, stock it. Pat

To: Sun Tzu who wrote (9822)	12/21/1998 10:53:00 AM
From: Scott Garee	Read Replies (1) \| Respond to of 16960

Well, Creative certainly came out of nowhere this year with the Voodoo Blaster line and the retailers seem to have accepted them readily. Prior to V2 Creative didn't have a real presence in video cards (certainly no bigger than STB has.) STB is not an unknown to the retailers. They have been selling a wide array of products via retail for a long time. When the TDFX carrot is hung before the retailer's noses they will certainly bite off a large chunk. They know the TDFX logo sells a lot of cards. STBI also already deals with all the distributors. There is nothing new which needs to be learned for this deal to work. The only change is the label on the box and, hopefully, the volume. The word on STBI management seems to indicate they are wholly capable of managing a rapid ramp up in volume. Of the range of hurdles to increasing business volume issues are certainly one of the most preferred, as opposed to brand recognition, market penetration, customer satisfaction, production, yield, etc., etc.