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Agreed, I wouldn't put too much truck into what a single analyst has to say. Its just an interesting opinion, one I haven't heard before.

A few years ago he bought Ancor for their switch business and it is now starting to pay off for Qlogic as he initially said it would.

Ancor was one of my core holdings for year back between '96 and '98, somewhere in there. Did very well when QLGC announced the acquisition. Remember when ANCR had the FC switch market all to itself? Noone else was in the business. Then big bad Brocade came along and all else is history. Everyone always knew Ancor had superior technology/products, but that never translated into sales. Seems like it was to a large extent a management issue. As far as I can tell QLGC hasn't reaped any big rewards from that buyout, which was *expensive* if I remember correctly. I always thought the deal was a good one for Q-Logic. Don't know why switch sales never ramped like Brocade's did.

I think QLogic has a great business. Its the only Fibre Channel vender to make consistent money. Pretty good money. ELX is coming around as well. Neither stock is cheap IMHO, and both have perfection priced into them. Seems like growth rates will stay under 30% or so from here on out as well, unless another tornado develops through new products (read IP switching!)

I currently have a position in McData, Brocade's largest competitor. Seems I'm always betting against Brocade one way or another. Why? Because I HATE CEO Reyes! Hehe. Could you give me some details on how the Ancor division is doing?

You make good points about the subcontracting. Price cuts can be passed along to manufacturers hopefully.



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