🚀 go-pugleaf

In article <1417@garth.UUCP> fenwick@garth.UUCP (Stephen Fenwick) writes:

>I must take exception to the first point.  A memory fab must constantly
>be straining the power/speed/density envelope to remain competitive;
>this can be ruinously expensive, as equipment (==entire fab lines)
>must be junked every two to four years.  Add to this the cost of
>sustained packaging, circuit design, and semiconductor research, and a
>memory fab becomes a hundred million dollar and up annual operation.
>The advantage to possessing this capability (buying at the production cost) 
>is greatly outweighed by the constant outlay for capital equipment,
>and the constant depreciation (in utility) of the equipment.

Well, your right, but I never said there wasn't any risk involved in
getting into the memory business.  One year ago, your argument would
certainly have sold me (as it did sell every other computer maker),
but look where it got Apple:  Apple can't produce and introduce
products it could very easily sell since there's no memory to make
them.  By going outside for their memory, Apple ran this risk.
A year ago, it seemed a good risk; however, events have proved it to
have been a mistake.  IBM is jumping back into the memory business
(I hear they're working like the dickens to bring a 2 MB chip to the
market) so Apple has even greater problems.  I guess this may be why
Apple went ahead and bought an existing but idle memory plant and has
started to build another one.  Let's face it:  no memory chips, no
computer business.

>Underestimating market demand is bad, and Apple should have known better.
>However, it is usually better to slightly underestimate demand (a healthy
>backlog looks very good to stockholders and Wall Street) than to overestimate
>and produce machines that must be dumped, or to idle production lines
>(a la many automobile makers).

Again, sound, but safe reasoning.  Apple has a great chance to take more of
the market in personal computing.  The lack of production facilities and
memory prevents them from exploiting this fading opportunity.

Jim Kweeder
kweeder@sun.soe.clarkson.edu