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Technology Stocks : Newbridge Networks -- Ignore unavailable to you. Want to Upgrade?

To: Ian@SI who wrote (11705)	6/2/1999 11:58:00 AM
From: WTSherman	Read Replies (1) \| Respond to of 18016

<Typically, margins are more robust on more mature products than on the newest additions to the product line. This is not always the case but usually is for revolutionary additions to a company's products.< Ian, where do you get this idea? This is exactly the opposite of what every high-tech company tries to achieve. Revolutionary new technology has the highest margin, because that is when there is the least competition. As the technology ages the margins decrease due to increased competition. The only caveats to this are when the very first production units are manufactured and the production process is either too small to achieve critical mass or company decides to subsidize the product in order to get market acceptance. Neither of these is the case with NN or ATM. From PC's to microproccessors to TV's, to CAT Scans, to MRI's this has been the case. The margins are always the highest shortly after production reaches critical mass and before there is intense competition.