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Tinker and all,

In my book the Gorilla Candidate becomes the Gorilla when not only is their a foreseeable Tornado but also when the investment reaches a new level of relative safety (as no investment is safe, all companies, including Gorillas can fall big time) which a "Gorilla Candidate" just cannot provide.

Fair 'nuff. And astutely proposed.

However, Tinker, you are changing the definition of a Gorilla on public threads when that term is defined differently in the two books written by the authors who first proposed the metaphor. I admire your ability to twink aspects of the book to fit your own investment thesis, but I encourage you to clarify for readers the difference between your definition of a Gorilla and the authors' definition when you proclaim a company a Gorilla. Otherwise, it's inescapable that readers assume you are using the authors' definition.

In the SI thread, we long ago addressed the various ways one might measure a tornado. I agree with you that we probably shouldn't limit ourselves to measuring it purely by revenue mostly because the revenue attributed directly to the sale of a specific product is often (usually?) not available if the company is selling more than one product. Your example of measuring CDMA adoption is a perfect example and is the reason I join you in measuring its tornado by growth of world-wide CDMA subscribers. In the case of Gemstar, I could buy the argument that the tornado is already in place based on adoption by the content broadcasters and the international consumer-electronics companies. But evidence of adoption by the end users of tornado-like proportions is not yet available, making it highly questionable in my mind that Gemstar should be crowned the Gorilla using the definition proposed by the authors of the book.

Where we disagree is that Gemtar's tornado should be measured by advertising revenue. Advertising revenue is an income stream that is not attributable to Gemstar's Gorilla-like characcteristics; instead, it is attributable to the Godzilla role Gemstar plays. Indeed, the most exciting aspect of Gemstar for me is that the company's Gorilla-like characteristics make the Godzilla-like characteristics possible, a unique opportunity found in few companies.

Where we agree is that Gemstar has no chance of not becoming the Gorilla of their space. However, because I can't confirm that the company has already achieved that lofty status, it's my thinking that weighting of the stock in our portfolios should reflect that we don't know when the tornado that adds a degree of safety to our investment will begin.

Just my opinion.

--Mike Buckley
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