Kirk Lindstrom

Outsourced Manufacturing Will Have Little Impact on Optical Suppliers' Operating Margins

You wrote:

"The optical components industry is still having trouble ridding itself of its science fair culture, and this is reflected in the nonsensical argument that outsourcing somehow puts intellectual property at risk. If this were really the case, the entire datacom and semiconductor industries would have been done in by copycats. "

This may not be true. The IP for Altera (ALTR) or even Intel (INTC) which is going to license and outsource some of its low power, low cost chips, is different than than the IP of Finisar (FNSR).

Much of the IP at Finisar is "how to" that once let out of the bag, is impossible to get back. When I worked at HP fiber optics in the 1980s and 1990s I came up with a manufacturing trick to get good yield on optical transceivers with a couple more db sensitivity than the competition. We never patented the idea because it would be impossible to enforce. We kept it secret and didn't even publish internal papers for internal conferences.

I believe Intel will keep its leading edge chip technology in-house. But it will license its low power, low cost Atom processors to TSMC so others can embed the processor in SOICs and pay Intel a licensing fee.

Finally, I read that many of the component vendors from China have parts to sell in the US but they are having trouble getting them qualified. Knowing how to put the pieces together to make a RELIABLE module is valuable IP, why share it with your competitors which is what you will need to do to get qualified... since what you teach your "partner" will be used to qualify your competition's parts build by the same people.

Cramer's Mad Money - A Bull on the China Stocks (2/13/09)

Does anyone have the performance figures for Cramer's Real Money portfolios for past years? If yes, please email them to me at the address listed on my website.

Fiber Optics Market: Benefiting from the Online Video Trend

Good article
Boring chart www.investorhives.com/...
I'm long since buying between $1.01 to $1.99 but this long, slow period and all this video demand has me considering adding even more. I thought a good correction would give a better price but it seems to be holding up well.
Kirk out