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Technology Stocks : Spectrum Signal Processing (SSPI) -- Ignore unavailable to you. Want to Upgrade?

To: WTSherman who wrote (2180)	1/30/1999 9:50:00 AM
From: nord	Read Replies (1) \| Respond to of 4400

WTSherman Your figures on the tiny size of this market makes me wonder all the more whether there really is the kind of potential here that will drive the value of this company up. I think that everyone on this board understands the future growth of DSP's. The question is whether the tack taken by SSPIF will ever be a significant component of the DSP business. What I find very odd is that in a financial environment that is ripe with speculation and totally focused on future growth, SSPIF has much lower power consumption more I/O and the next wave of DSP boards became much more attractive to OEM'S. In the early days the boards contained a tiny fraction of the number crunching lacked sophisticated [RTOS] real time operating systems, and were much more difficult to debug ie the tools algorithm development and tacer technologies were still on the board [drawing board]. During the last couple of years SSPIF has developed a very close relationship with TI. Note the move of Ron Wages from TI where he was head of worldwide marketing for TI to be released C^ series. When he came he made it clear that he thought the potential of Spectrum future was huge. He was overseeing the development of the high end C6 cores and working while at TI with Spectrum during the development of the cores. SSPIF was very influential in the design as they all wanted to make sure that the new dsp cores would have the performance, power features, power consumption, and cost points to be valuable to the oem's. We then entered the new era in dsp board companies. Note the suite of products [go to boards at SSPIF web site. spectrumsignal.com Along with Greensprings a subsidiary of SBS technology standards for [COTS] customizable off the shelf boards were developed to allow for the boards to be easily inserted onto standard platforms. This was a major step. In addition Spectrum won there first major oem contract with OEM IBM for their award winning office fx board. By accepting the lower margins high production contract Spectrum developed the capacity to produce large numbers of units ie the production capacity and trach reecord. While the contract didn't meet revenue expectations as it was a high end board for SOHO and high end PC it was a milestone for Spectrum and raised them to the top of the dsp board companies at a time the industry was just beginning to crawl ie its infancy. Since that time the comapny has grown tremendously employees from 10 to 170 employees. They have made two key acquisitions 3L a leading RTOS and ALEX a small but highly successful and talented ADI core centric company that broadened the offerings of Spectrum. During the first 10 years SSPIF grew revenues at 30% yr/yr. They opened offices in Europe and made VAR agreements in Asia. The company digested the acquisitions creeating a new software division focused on tooling eliminating redundancy and decresing costs. Note the tracer board for ADI the Hurricane the to be named core-core asic under development for baja. The tracer board IMO is a real advantage as it speeds the degug process immensely. The new boards were designed with specific applications in mund. They now contain a single high end core to multicore design. with these boards and new cores the cost of using dsp for a broad array of applications has opened up. This is where we are today. The company has developed a multitutde of boards for a variety of platforms that could be easily programmed by or for a specific application. The phone began to ring and hasn't stopped ringing. The West Coast sales director is being called into the field to help meet the needs of customes. While 98 saw a global slowdown in technology and hence dissapointment in revenue growth Spectrum continued to work and has announced 50+ ins mmany are now wins and most will become wins. The Boeing contract for example is a prototype contract. If Boeing and the military accept this next generation radar the value of this contract mnay be huge. The Kodak contract for digital labs is alreadu being advertised on tv and touted by Walgreen Drugs despite the fact that Kodak is just getting its sales team up to speed on the new lab it will be the state of the art for digital cameras storage reproducing editing cropping etc. it can receive your pictures by download from your pc and have a tremendous array of options for the final product. As far as the future of DSP the board industry Forward Concepts Wil Straus is the recognized authority fwdconcepts.com Spectrum has stated that they willl return to the 30% growth rate once the global slowdown in tech dissipates. They have focused their products on 4 vertical markets and are getting lots of business with Fortune 1000 companies. The prediction is still for $67M US in revenue for SSPIF for the year 2k. With breakeven now at 7 Million qtr. the margins in the 50-65 % the profits will come. The working relationship with the core companies is closer than ever witness the TI mailer of Spectrum boards to its ales force and customers and the worldwide broadcast at last dsp world sponsored by TI where Spectrum enguineers gave a tutorial to a worldwide audience. The relationship with ADI also has grown since the acquisition of Alex Computer. I am looking for a series of announcements ince the TigerSharc is ready for real time Lets look into the future. Radar/ sonor/ motor contol/ wireless etc. The reason I am so confident in the future of Spectum and DSp market is that dsp allow for real time interaction of computers and the real world. DSp boards make this possible by their hugh number crunching capabilities in real time making collision avoidance cars a reality distant radar a reality broadband wireless a soon to be reality. IF you want to get an idea of where the dsp industry is going read Tom Engibus' [CEO at TI] vision statement from TI url ti.com Lets say that the 50 ins for 98 turn into 40 wins. Some of these will be for one time orders some will be for recurring orders. Some will have value in excess of over $20 M US to Spectum. If you do the math it is easy to see where the 67 M forecast comes from. With the company carrying a market cap of30M you can start to get an idea of the value and growth that lay ahead. My personal believf is that within the next year we will see considerable upgrade in future revenue production as recurrent orders come ina nd the relationships with Siemens Kodak and others leads to new product opportunities. I Why doesn't Spectrum getr any recognition? They do. Right now it is from there customers. The vast majority of micro cap tech companies have no street coverage. When spectrums revenues hit the radar screen of analysts the stock price will be much higher. What would you pay for a company growing at 30-100% with 50% margins no debt at the epicenter of the dsp revolution? If you are a momentum player you are early. If you invest with a time horizon of 2 years you will see your investment return handsomely. Timing.who knows when Spectrum will announce the 100 M 3G basestation contract or the jv or equity stake by a larger company. Speaking of analysts I don't know any that understand DSP. Rewcentlu Brown Brothers Harrimen downgraded TI when it was selling in 40"s because they had beome too focused on dsp.. huh? I just sit back and smile and realize I know what I know and that I am confident enough to haveinvest a large amount of time and personal funds in the quiet company the visionary company that will soon be a giant in the dsp world IMO. Regards Norden ps all of the above is from my vantage all should do there own dd. If anyone would like to learn more I'll add a few more links threel.co.uk analog.com analog.com fwdconcepts.com comsoc.org Regards Norden