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

To: Patrick Grinsell who wrote (13114)	6/4/1999 12:03:00 AM
From: Sun Tzu	Read Replies (2) \| Respond to of 16960

Re OEMs I agree and that is why previously I emphasized Computex. Re platform I don't think 3dfx can pull it off as they stand. They just don't have the resources and the clout to do it. This is why if they were smart, they would partner with the firms that I mentioned. Here is the pitch: Since ATI has made a partnership with GIC for set top boxes, 3dfx should approach SFA (GIC's main competition) for a similar deal. With ERTS, they already have a decent relationship. They should build upon that by closely addressing their needs and putting a few people over there and bringing in ERTS' programmers into their meetings from time to time. This would give ERTS a leg up with regards to upcoming chips and features. Naturally this means that ERTS will be able to make glide games faster than anyone else. In return they promise to release Glide only games at least two weeks before the D3D version. ERTS will also promise to supper 3dfx chips for the SFA's set top boxes and SNE's consoles, should they happen. With Sony (or another console maker), the pitch is simple: "Here is a chip that is 10 times faster than your existing one and already has a lot of games and developers on its side, Use it and we'll give it to you almost at cost. We'll share the profits together and you give us some support during the industry uphevals". Since INTC absolutely sucks in their graphics efforts and failed miserably with their i740, 3dfx should lend them a hand. The idea being that (a) Intel will produce a decent chip for the low to medium-low end of the market but will not move any higher. And (b) their chip will mesh very nicely with 3dfx's chips so that perhaps they could load share or something. In addition, 3dfx would promise to embrace the strategic Intel direction of pushing better and better graphics into the main stream. I hate to say it, but if Intel does not go for it, they should talk to AMD. Of course there are challenges to be met in each of above cases, but this is the way that 3dfx can become a "Entertainment Platform", given its limited resources. I listed these options in order of risk/difficulty, so I am aware of the difficulties that the last two may pose. Still, no guts, no glory. Re Technology lead Without superb technology, it is hard to win mindshare in the high-tech industry. True, the best technology does not make you a winner. But every time the best tech has failed, it's been either because it was not good enough to justify the extra costs. Or because the management majorly screwed up the execution. Barring these two, good technology is a must. One thing that I tried to emphasize, was the need for the technology to be scalable and open. The scalable part means that you can remain in the sweet spot of price/performance longer while at the same time covering yourself as the top end performance player. The open part means that you provide others with ways to extend and use your technology in a way that you had not foreseen (or did not care about). For example, the cards should ship with graphics equivalent of USB so that others can develope 3D glasses for it. It is time for people to realize that the computer business is "subscription" business (like magazines) and not one time sale business (like books). Sun "I hope someone at 3dfx is listening" Tzu