________________________________________________
- THE FRIDAY LETTER -
(emailed weekly, from Gilder Publishing,
for friends and subscribers)
__________________________________________________
| http://www.gilder.com/ | Issue 266.0/September 29, 2006
SIGN-UP A FRIEND FOR FREE!
HEADLINES:
- The
Week / Synaptics: Too Much Linearity
- Friday
Feature / Metcalfe: How Online Video
Will Change The World
- Friday
Blogger Bonus / Multiple Must-reads
- Readings /
|
Gilder/Forbes TELECOSM 2006 |
The
Week /
Synaptics: Too Much Linearity
Charlie Burger, Senior GTR Technology Analyst (09/12/06): Dominating the PC touchpad market, Synaptics
is a primarily analog company with roots reaching back twenty years when Carver
Mead showed the way to create analog systems that scaled like digital systems
in accord with Moore’s law. The company made little progress until the
mid-1990s when, as a result of ingenious mixed-signal inventions by Mead
student Tim Allen, a breakthrough came in the realm of touch.
So
superior were the company’s touchpads that they quickly took over the industry.
Unlike rivals Logitech (LOGI) and Alps, Allen used a capacitive
sensing pad rather than a resistive pad to identify the placement of the
finger. A patented analog converter can locate the capacitance aroused by the
finger on the pad to an accuracy of around 25 microns, or a quarter of the
width of a human hair. Synaptics’s superior pads came down in price to the
point that rival Logitech exited the business, and the company’s touchpads now
go into more than half of the world’s laptops.
Fresh
in many investors’ minds is the “Apple Affair.” Almost two years ago, Apple
(AAPL) propelled Synaptics forward with its famous iPod scroll wheel, only to
reverse course six months later, replacing Synaptics touchpads on some lines of
notebooks and iPods. As a result, Synaptics’s fiscal year 2006 (ending in June)
sales slid 11% from the prior year, earnings fell to $0.85 per diluted share
from $1.23, and Wall Street sliced the company’s market cap in half.
Discounting
the Apple spike of 2005, Synaptics’s sales have been climbing linearly since 2003,
a sign of decelerating momentum. Though laptops have been gaining share in the
global PC market, rising to a third of shipments last year from just under a
quarter in 2000, the concurrent ascent of touchpad shipments has been too weak
to sustain Synaptics’s forward speed. To rejuvenate the company, management has
been organizing an invasion of the huge markets for teleputer sensors and
imagers.
The
relentless march of digital media into home entertainment and portables plays
into Synaptics’s strengths. Synaptics’s touchpads are perhaps even more
advantageous in small mobile devices than in the conventional PC market where
they have been so successful. The technology is just 0.15 millimeters thick
compared to one to several millimeters for competitive solutions. Key to
touch-sensitive LCD screen applications, Synaptics arrays are also more
transparent, transferring 98% of the light to the user.
Synaptics
hopes to put its capacitive touch interfaces wherever you might find buttons,
switches, or LCD screens. By combining navigation and multimedia on the
touchpad itself, Synaptics is already enhancing digital media devices by
enabling users to look at movies or listen to music without turning their
computers on. Now shipping in Korea are cell phones with interfaces that
display both navigation and quick launch buttons that provide easy access to
applications such as music and messaging. Possible
new markets beckon in desktops and peripherals including keyboards and monitor
controls….
But barring another Apple-type deal, is
Synaptics still a worthwhile investment?
Excerpted
from the September issue of the Gilder Technology Report. To read the complete Synaptics
(SYNA) company update, as well as updates on Ikanos (IKAN) and Essex
(KEYW), see www.Gildertech.com.
|
Capturing impressive long-term gains,
Gilder’s tech portfolio is up 285% since the market low in
October 2002, compared to 99% for the NASDAQ and just 69% for the S&P
500. Year-to-date
returns for Gilder’s “Telecosm Technologies” companies continue to impress.
Equinix is up 46%; Finisar is up 58%; EZchip is up 89%;
and Broadwing up 102%! |
Friday Feature
/ Bob Metcalfe: How Online Video Will Change The World
Video Link, (09/27/06): When Bob Metcalfe talks about the future of the Internet, people take
note. He invented Ethernet, the international standard for local-area
networking. Technology Review caught up with Metcalfe last night at the
opening reception for the Emerging
Technologies Conference. He told us why he thinks Internet video could have a
positive environmental impact by reducing the need to "press the
flesh."
View Video: http://www.technologyreview.com/blog/VideoPosts.aspx?id=17423
RELATED READING
Metcalfe Vouches for Video
http://www.lightreading.com/document.asp?doc_id=86214
|
The Gildertech Blog, http://blog.gildertech.com/ | Logon now to see what’s new. |
Friday Blogger Bonus / Multiple Must-reads
Paul
Kedrosky, “Wired Has Its Mojo Back” (09/27/06): The current issue of
Wired is very good, the first issue in ages of the once-hot-hotmagazine
to contain multiple must-read articles.
Highlights:
- An otherworldly and cautionary piece on the Gizmondo meltdown
- George Gilder on compute clouds and the limits of computational parallelism
- A look at the backstory on eBaumsworld
Check Out Paul’s Blog: http://paul.kedrosky.com/archives/2006/09/27/wired_has_its_m_1.html
___________________________________________
The Information Factories (On newstands now in Wired magazine. Available
online Oct. 9.): The desktop is dead. Welcome to
the Internet cloud, where massive facilities across the globe will store all
the data you'll ever use. George Gilder on the dawning of
the petabyte age.
___________________________________________
Readings /
Telecosmic
Time Travel
http://blog.gildertech.com/index.php?/archives/26-Telecosmic-Time-Travel.html
10th
Annual Gilder / Forbes Telecosm Conference
http://home.businesswire.com/portal/site/google/index.jsp?ndmViewId=news_view&newsId=20060928005253&newsLang=en
Stock Spam Hits Cellphones
http://www.forbes.com/home/intelligentinfrastructure/2006/09/28/spam-text-wireless-tech-intel-cx_df_ll_0929spam.html
Disclosing Security
http://www.forbes.com/home/columnists/2006/09/28/terrorism-risk-insurance-biz-cx_rh_0929terror.html
Stop tiptoeing around TV's future
http://www.theage.com.au/articles/2006/09/27/1159337221919.html
Fed
Ease In 2007?
http://www.ftportfolios.com/Retail/research/viewresearcharticle.aspx?id=159
Economic
Expansion And the Angry Bears
http://article.nationalreview.com/?q=ZjEyMGQ3NTlhYTIzZTU4Y2VhNTMzZDFmYTNlOThjNDU=
Deanonomics
Is Pure Deanogoguery
http://article.nationalreview.com/?q=YjJhYzQwNWFiYzhhZTAxZTVmZjIwODU4MjM3MWY5MDg=
A
Pebble’s Ripple Effect
http://www.tcsdaily.com/article.aspx?id=092706B
Amazon:
Servers For Hire
http://www.technologyreview.com/read_article.aspx?id=17554&ch=biztech
Just
Announced Foveon Sensors Featured In New Sigmas
http://www.popphoto.com/photonews/3100/just-announed-foveon-sensors-featured-in-new-sigmas.html
Intel
Develops Tera-Scale Research Chips
http://www.kurzweilai.net/news/frame.html?main=/news/news_single.html?id%3D5944
___________________________________________
SIGN-UP
A FRIEND FOR FREE!
Click here to add a friend to our Friday Letter mailing
list.
_______________________________________________
FRIDAY LETTER STAFF
Editor: Mary Collins / mcollins@gilder.com
Research: Sandy Fleischmann / sfleischmann@gilder.com
ADVERTISING INFORMATION
The Friday Letter is mailed each week to more than 150,000-plus
subscribers and friends of Gilder Publishing, including industry leaders,
financial professionals and individual investors. For information about
advertising, contact Mary Collins at mcollins@gilder.com.
PLEASE NOTE: The appearance of an advertisement in the Friday Letter
does not indicate an endorsement for the product and/or service by George
Gilder, Gilder Publishing LLC, or the Friday Letter staff.
FEEDBACK AND PROBLEMS
For technical problems, or to send letters to the editor, please
e-mail info@gilder.com.
MAILING ADDRESS
Gilder Publishing, LLC
ATTN: Friday Letter
291A Main Street
Great Barrington, MA 01230
_______________________________________________
The Friday Letter is published weekly for subscribers and
friends of Gilder Publishing. If someone you know would enjoy it, please feel
free to forward a copy.
Gilder Publishing makes the Friday Letter available for free. To
help defray some of the costs of producing this information on a weekly basis,
we will from time to time be sending you offers from companies we think you'll
be interested in. These offers will not come more than once a week. If you do
not wish to receive this related information, please opt out of this process at
the link below and we will not share your name with companies outside of Gilder
Publishing.
http://www.gilder.com/unsubscribe/specialproducts.php
To SUBSCRIBE please visit http://www.gilder.com/
To UNSUBSCRIBE please go to http://www.gilder.com/fridayletter/unsubscribe.php
Trouble subscribing or unsubscribing?
Email info@gilder.com
_______________________________________________
Copyright 2006 Gilder Publishing LLC