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- THE FRIDAY LETTER -
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| http://www.gilder.com/
| Issue 273.0/December 1, 2006
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HEADLINES:
- The
Week / Gilder: Security at the Edge
- Friday
Feature / Synaptics Begins Invasion
- Friday
Blogger Bonus / Gilder's
Ten Rules For Tech Investors
- Readings /
|
The
Gilder Technology Report’s tech portfolio is up 351% since the market
low |
The
Week /
Security at the Edge
George Gilder (November 2006 Gilder Technology Report
excerpt): I am with our Silicon
Valley editor Nick Tredennick at a Linley Group tech seminar on “Programmable
Devices for Network System Design” at the Santa Clara Marriott and the
PowerPoints are filigreed with schematics as the complexities mount in a
combinatorial explosion up and down the software stacks and hardware cores of routers
and switches and combo boxes and multiservice crossconnects. Coffee consumption
soars. Everyone wants a programmable synaptic accelerator to keep up with the
double data rate acronyms on stage. All we hear about is intelligent
processing, knowledge bases, real-time pattern hashes and regular-expression
matches in the core of the network.
Motivating much
of this imbroglio of network intelligence is something called “security.”
Security functions proliferate at layers two, three, four and seven in the
standard seven-layer network model (with physics at layer one and applications
at layer seven). Cavium and Raza Microelectronics contest the
security space with embedded multicore and multithreaded machines. Hifn
(HIFN) crowds in. Encryption moves to Seagate (STX) hard drives under
the Trusted Computing Group (TCG) with Wave Systems (WAVX)* software and
to ConSentry using a 128-core processor to implement the TCG standard in
the local area network (LAN). As fast
as security is consolidated, it metastasizes across the wide area and the web
into virtual cities of beckoning high-rise chips and boards and boxes.
When
are they going to figure out that with security everywhere at every interface,
no one is safe? Hackers are now using unbreakable encrypted paths to invade
your browser. The more security we get the more we worry about something called
“privacy.” Privacy is chiefly for crooks and terrorists and for people with an
exaggerated notion of others’ interest in them.
SSL, IPSec, MACsec, RSA, Triple DES, AES, FIT, PGP all add up to paralysis in
the core. Better to ride the light and let the bad guys chase photons through Infinera
chips, while we move security to the edge where it belongs.
We need dumb-as-a-stone
all-optical networks, riding on the light. We need security at the edge not in
the core router.
Read
the complete November and December issues of the Gilder Technology Report now.
Log on with your subscriber ID at http://www.Gildertech.com
today.
(*George Gilder is a member of the Wave Systems board of directors.)
|
The Gildertech Blog, http://blog.gildertech.com/ | Logon now to see what’s new. |
Friday
Feature
/ Synaptics
Begins Invasion
From the www.Gildertech.com
subscriber-only message board.
GTR Tech Analyst, Charlie Burger (11/27/06): Over
two months ago we told you not to expect much upside in this stock before next
summer. Since then the price has risen almost 20%, from $25 to a peak near $30
two weeks ago. Our story remains largely intact (GTR, September
2006)—Synaptics has begun an invasion of the huge markets for teleputer sensors
and imagers with new, lower margin multimedia products. What has changed since
our last report is that these products are ascending quicker than expected, and
gross margin is falling further than forecast. But the top-line is winning the
race, giving a small boost to earnings. Most recently, PCs propelled sales up
25% sequential during the September quarter as multimedia controls ramped
rapidly in laptops and peripherals.
Also subduing earnings, in addition to declining gross margins, have been climbing development expenses as Synaptics fends off gathering competition in the fast-growing consumer electronics market. Though the company has a proven track record shipping multimillions of interfaces using capacitive technology, it must continue to diversify into new markets and find new ways of letting users interact with their appliances in order to preserve its leadership position. Recent innovations include buttons on LCD monitors for controlling onscreen display and audio, wireless keyboards with touchpads that incorporate cursor navigation and quick access to applications and controls, biometric interfaces for fingerprint recognition, and quick-launch buttons on ultra-thin cell phones enabling easy access to music, messaging, and more.
With
demand still rising across all target markets, especially in laptops and
portable music players, expect sales to increase 30% sequentially during the
December quarter….
Logon to the subscriber-only message board with your subscriber ID at
www.Gildertech.com to read the
complete Synaptics (SYNA) writeup and more posts by Charlie Burger and
George Gilder.
|
Did you miss GILDER/FORBES Telecosm
2006? |
Friday Blogger Bonus / Gilder's Ten Rules For Tech Investors
Forbes Publisher, Rich Karlgaard (11/29/06): Reporting live from the 10th
Forbes Investor Cruise--we're floating somewhere in the British West Indies
now--I'll summarize George Gilder's speech.
Ten
Key Rules for Early-Stage Technology Investors to Triumph in This Time:
1.
No one knows less about the fast-growth tech business than the CFO. Early-stage
tech is about the future. CFOs deal with past numbers. In effect, CFOs are
trying to steer companies by looking in the rearview mirror. Moreover, CFOs
tend to focus on internal problems, and early-stage tech companies should not
try to solve problems. They instead should pursue opportunities. Solving
problems sounds good, but it is a loser. You end up feeding your failures,
starving your strengths and achieving costly mediocrity.
2.
The elasticity of Moore's Law. In the tech world, Moore's Law ordains that
prices routinely drop 50% every 18 months for a given rate of performance. In
older businesses, price collapses would be bad. But in the tech world, users
multiply when prices drop. You get positive elasticity.
3.
Metcalfe's Law. The value of a network rises by the square of the number of
compatibly connected users. Obviously not literally true, yet a rough and
useful guide.
Read Rules 4 – 10:
http://blogs.forbes.com/digitalrules/2006/11/gilders_ten_rul.html
Check out Rich’s Digital Rules blog:
http://blogs.forbes.com/digitalrules/
__________________________________________
Readings /
Anadigics
Powers Up
http://www.forbes.com/personalfinance/guruinsights/2006/11/22/anadigics-verizon-qualcomm-pf-soapbox-in_cb_1122soapbox_inl.html
AMD Launches Quad-Core Processor
http://www.eetimes.com/news/latest/showArticle.jhtml?articleID=196600589
What
Comes After Web 2.0?
http://www.technologyreview.com/InfoTech/17845/
Break
Out The Bandwidth
http://www.forbes.com/2006/11/21/xbox-myspace-youtube-tech-intel-cx_df_1122bandwith.html?partner=telecom_newsletter
Squarks, Bosons and Zinos, Oh My!
http://www.wired.com/news/technology/0,72199-0.html
Gelernter,
Kurzweil Debate Machine Consciousness
http://www.kurzweilai.net/news/frame.html?main=/news/news_single.html?id%3D6143
Greatly
Inflated Expectations
http://article.nationalreview.com/?q=ZGZjYzg3YjdjMzlmZjIzMWU1ZTI3YmNiMDdiNDZmN2U=
The
Unfairness Of A “Fairer” Economy
http://article.nationalreview.com/?q=MzdmMjQwYTNhNGY0OTkzYTAwNTllNjBkYjM1OGNlNGI=
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