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Geoffrey Moore posted a message on the GG listserve today in which he discussed the parallels between RMBS today and QCOM last year. Here's a snippet:

...parallels between market reaction and adoption of Qualcomm and Rambus. In both cases the companies showed up with blocking patents in key technologies. In both cases the industry required to license these patents has done everything it possibly could to wriggle off the hook. In neither case do they appear to have succeeded. I just saw a squib yesterday that Intel shut down its "bridge" chip operation, after losing $250M on it--this was to be a substitute technology for Rambus. Now RDRAM is the only supported solution in the architecture plan, I believe. This would appear to solidify their gorilla anchor.

He went on to address the issue of "gorilla adjacency power," which he defines as "the ability of a gorilla to muscle into adjacent markets." The question now is, will a value chain consolidate around Rambus technology for other memory applications (aside from PCs)?

From his comments, it sounds to me as if Moore believes the game is already over as far as PC memory is concerned, and although he didn't state it flat-out, it sounds like he's calling Rambus a bona fide gorilla at this time. It's interesting to me that he seems to be making the call much earlier for Rambus than he did for Qualcomm.

Jason

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I remembered just after I posted my last message that Moore, Johnson, and Kippola said RMBS was a gorilla in the next-generation memory market as early as 1998 (see the revised GG, p. 135). This raises two questions:

1. Where was the tornado in 1998? There certainly was no tornado for RDRAM at that time. Were the authors convinced back then that RMBS' IP was going to cover SDRAM (the tornado for SDRAM was well under way at that time)?

2. Who made up the value chain for RDRAM back then? Intel alone?

In other words, how can you have a gorilla with no tornado and no value chain to speak of? Remember I'm speaking of 1998, not today. What am I missing here?

Jason
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...how can you have a gorilla with no tornado and no value chain...

RMBS does not seem to fit the mold of a gorilla. What they have done is similar to striking oil. RMBS is going to see a lot of pure profit for some time to come.
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It's interesting to me that he seems to be making the call much earlier for Rambus than he did for Qualcomm.

That's because at the time Qualcomm became a gorilla, Moore still thought it was a prince playing in Nokia's royalty game. Only later did he realize that Qualcomm was even in a gorilla game.

--Mike Buckley

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Jason--

<<It's interesting to me that he seems to be making the call much earlier for Rambus than he did for Qualcomm.>>

There's some history here, in case you don't know. Mike Buckley called the QCOM ascent to gorilladom the night of the Ericsson deal; see post #833 on the Silicon Investor "Gorilla and King Portfolio Candidates" thread. Within a few weeks, after much vigorous discussion back and forth, the SI G&K board (IMHO the most sophisticated arbiter of such things) agreed.

Moore, however, staunchly denied that this was the case. Suggestions at the time were that he didn't realize the full extent of Ericsson's capitulation, or that he didn't really understand the wireless sector, or whatever. Anyway, faced with something of a crisis (i.e., a difference with the guru on the biggest question of the day), the SI G&K posters rechecked their analysis, came to the same conclusion, and stuck to their guns. Some months later (I believe it was August, but I'm not sure) Moore changed his mind. Good lesson on not delegating one's own thought processes to others.

tekboy

PS One reason I go into this in such detail is that Moore has seemed to refer to JDSU as a gorilla more than once in recent months, even though a clear consensus of serious G&Kers view it as a king instead. See also the confused list on p. 100 of Living on the Fault Line, where Moore in passing makes a number of questionable classifications....
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<<the SI G&K board (IMHO the most sophisticated arbiter of such things)>>

ooops! tactless and irrelevant; thought the original post was on the Rambus board, not the GG board... sorry to all for any offense given...

tekboy@whydoesn'ttheFoolhaveabloodyEDITfunction???.com
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I believe TRFM referred to Rambus as a potential gorilla, with the discontinuous innovation(s) in place and a value chain beginning to form. Tornado was not yet on the horizon, but was at the same time somewhat predictable.

phil.
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justphil:

I believe TRFM referred to Rambus as a potential gorilla, with the discontinuous innovation(s) in place and a value chain beginning to form. Tornado was not yet on the horizon, but was at the same time somewhat predictable.

Actually, here's the quote I was referring to from p. 135 of TRFM:

In 1998, for example, a company called Rambus took on a gorilla position in the emerging market for next-generation memories.

You may be remembering the original version of GG, where the authors refer to Rambus as a potential gorilla. From p. 123:

In 1997, for example, a company called Rambus looks to be a strong gorilla candidate in the emerging market for next-generation memories.

These two sentences are the only ones in either book that refer to Rambus, as far as I know.

Jason
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My good friend tekboy at micromanagement's4ME.com wrote:

the SI G&K board (IMHO the most sophisticated arbiter of such things)

Holy smokes, Batman! Look who showed up for dinner!

I remember your sophiscated arbitrament of AMD. And Echelon. And - what were those other pebbles and small-caps? <ggg>

ooops! tactless and irrelevant; thought the original post was on the Rambus board, not the GG board... sorry to all for any offense given...

Oh yeah, right! We're not offended. I'm encouraged. "Dew drop in" more often for some spirited and sophisticated arbitration. Tell tekgirl she's allowed to call you a Fool at any time.

tekboy@whydoesn'ttheFoolhaveabloodyEDITfunction???.com

It must be that notion of Foolish proofreading. Not to worry, we all would enjoy an edit function since we use the tiny monitors late at night with eyes that no longer see what they saw BL&G (before lenses and glasses).

BB@IoweyouaBEERor2-doyouhavetimeinJulyorAugust?.com

P.S. You would be very proud of me. I managed to actually sit through an entire performance of "Die Walküre". However, it was only because a friend of mine was honking out the tenor. He supplied the beer afterwards. I'm not sure if Wagner or the real Budweiser was better. <ggg>
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omigod...

is this for real? the actual, sainted Bruce Brown speaking to me in person? I'm getting chills just looking at the screen....

folks, this kind of opportunity doesn't arise every day--well, not more than few dozen times a day, given his posting habits--so one has to treat it with the proper sanctification and genuflection...

<giggle>

GGers, disregard his slurs on AMD. Great company. Some even think it might become a prince to Intel's king over the next couple of years, as opposed a monkey to Intel's gorilla. Me, I can hardly spell gorrila, so WTFDIK... As for ELON, BB, could that actually be one of the three or four companies out there that you don't own?

tekboy@tekgirlalreadythinksI'mafool.com

PS put me in your group during the seminar or I'll tease you mercilessly forever...
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so one has to treat it with the proper sanctification and genuflection...

My wife has to constantly remind me not to do that at Temple. I do it just to piss her off and get a giggle out of the kids these rare days that I go to Temple with them. They get me back when I drag them to the gothic cathedral for special holidays to sing hymns of praise in German while the pipe organ blasts the morning coffee through my veins. At least there are no soldiers with machine guns guarding the church here in Vienna. Going through a passport and body search to step in the Temple here with six large soldiers holding some serious iron is the reason I genuflect once I get inside. <ggg>

GGers, disregard his slurs on AMD. Great company. Some even think it might become a prince to Intel's king over the next couple of years, as opposed a monkey to Intel's gorilla. Me, I can hardly spell gorrila, so WTFDIK...

It's like this:

C - R - O - W

You want to go down the Intel/AMD gorilla/monkey vs. king/prince path again? I don't. Skip back a few posts and chat with BeRealCNBC. You two can chat discontinuous innovation. I can't afford to as silent gorilla Intel has kicked into the high compounding effects of being a long term holding. Let's just say that there are a lot of devices that need chips and microprocessors these days and that is only going to grow in the future. Gateway has talked to Transmeta and Michael Dell recently announced they are talking with Transmeta as well. Intel will continue to have their work cut out for them, but I'm liking the company an awful lot from an underlying business metric point of view. I wish my voice could print cash like that after my 15 years in the business. I'm afraid the advantage goes to the gorillatone over the baritone.

As for ELON, BB, could that actually be one of the three or four companies out there that you don't own?

You nailed me and you know I love it.

Not to worry. My dozens of daily posts are still fewer than your collection of collected posts that point to the posts others have made. I think we need to get out with our mates a little more often. <ggg>

Now that we've given the Fools on the GG board our version of fun with each other, I need to get on with my dozen posts before bedtime quota. After all, I'm leaving on a jet plane come Sunday 8 AM for 2 months of R&R. I won't be around too much until the end of August outside of the Rule Maker seminar. At least I have golf for my withdrawal during those 2 months.

Should we make a wager? How about you count how many trades you do between July 2 and August 20th. I'll count how many rounds of golf I play in California during that same time period. Whoever has the highest number wins and buys the tickets to the Ring next year. Die Walküre got me pumped and I think I can handle the whole tamale now. By the way, my preference is an aisle seat in about the 23rd row. That allows me to go out for a walk and grab a snack at various times during the opera to refresh my mental state before absorbing more of Richard's tunes.

BB
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