A gratifying array of industry heavyweights took the trouble to despatch a top staffer to San Francisco to impart some enlightenment to the Robertson Stephens & Co 1995 Technology Conference, and Reuters and Dow Jones & Co each had people on the spot to disseminate some of the proceedings to a wider audience: the items on this page have been compiled from their reports.
Perhaps the hottest hardware property looming on the horizon right now is the P7, first fruits of the alliance between Intel Corp and Hewlett-Packard Co to develop a common successor to Precision Architecture and iAPX-86, and Intel chief operating officer Craig Barrett told the conference that the P7 would appear in 1997 – engineering teams from the two companies joined up last summer to work on a P7 design – but he would not discuss the architectural direction of the P7 work beyond saying that it will have lot of innovation in it.
Intel Corp’s Craig Barratt preferred to dwell on the company’s recurring theme that central processors should carry out more of the functions of a computer now handled by add-in processing devices: he said the typical multimedia computer today has 16 different add-in boards and communications links for separate processing of the video, audio and modem communications and that the old argument that too much peripheral processing in the core would eat up too much microprocessor’s capacity won’t wash any more with the P6 rated at 250 MIPS, twice the power of the Pentium; he expects some computers built with P6 processors will handle some of the processing now done by peripheral devices and P7-based computers will likely continue that trend; he also forecast that there would be an increase in the trend exemplified by AT&T Global Information Solutions’s Intel-with-everything strategy whereby everything from notebooks to massively parallel machines use the same architecture.
Electronic Arts Inc expects to command a 15% to 16% share of the games software market in 1995, Stanton McKee, chief financial officer told the assembly – but that would represent a decline because the company had 18% last quarter, up from 16% a year earlier; about half Electronic Arts’s overall new products will come from CD-ROM titles in calendar 1995, a sharp increase over the 19% of last year.
Broderbund Softeware Inc is also looking to CD-ROM for growth: it expects its fiscal 1995 gross margins to be between the 59% of 1993 and the 64% of 1994, said president William McDonagh: Broderbund expects sales from CD-ROM titles to account for about 80% of company-wide revenue in calendar 1995, up from a little over 50% in 1994.
Legent Corp’s new chief executive officer Jerre Stead needs to woo the financial community so went along to make his own pitch, saying he plans a tremendous effort to streamline operations and a revamped sales focus from individual software products to integrated products and services: coming from running AT&T Global Information Solutions, Stead said he was surprised by the amount of bureaucracy inside Legent, which is a fraction the size of his previous charge, and he also found conflicting objectives and an inward, product-oriented focus at Legent; he did not talk about financial goals other than to maintain a 20% operating margin, but later told Reuter that he left AT&T because he wanted to be part of a smaller company that was in a new, young market; I’ve done four turnarounds, I think a person should only have to do two in a lifetime – this is a turn up situation, not a turn around, he said, adding that the market for integrated client-server systems will grow very fast, and that none of Legent’s main competitors appears to be offering integration.
EMC Corp sent its director of investor relations John Ryan along and his message was that EMC expects the market for storage products to continue the strong growth it has shown in recent years, and EMC expects about $200m in additional revenues from its new open-systems products in 1995, with that figure doubling until 1997 s
o that open systems products bring more revenue to the company than mainframe products by late 1998 or early 1999; he expects competition in the client-server storage market from Hewlett-Packard Co and IBM Corp, but he reckons EMC should increase its market share of the mainframe storage market to about 35% in 1995, against 28% last year; the company should also retain its 21% share in the IBM AS/400 market.
Atlantec Corp chief executive George Archuleta told Reuter at the conference that the fiscal 1995 earnings estimate by Robertson, Stephens & Co of $0.51 a share for his local networking equipment company is okay, but conservative: in 1994 Atlantec earned $0.35 a share but revenues are growing at about a 100% clip, Archuleta said, adding that he sees nothing in the foreseeable future to interrupt that pace; Atlantec had 1994 revenues of $25.1m, almost double the 1993 level of $13.6m.
America Online Inc expects its subscriber base to increase to 2.3m by the end of the current quarter in March, almost twice the number it had in September, said chief financial officer Lennert Leader.
Macromedia Inc develops authoring tools for multimedia productions, and it aims to maintain its lead over new competitors by developing tools that enable authors to create programs that will be playable on many different machines, chief financial officer Richard Wood told the attendees: the company hopes its author once, play anywhere software development effort will keep multimedia creators in its camp by offering the lowest cost of authoring with Authorware under the new Portable Player Technology plan that will enable developers to create one version that can be run on a Macintosh computer, a Windows-based computer, an Internet or on-line services environment, a television set-top box, or a 3DO Co games player, Wood said, adding that the Portable Player products would be on the market in the next year or possibly two, and that nobody else had anything like it.
Novell Inc expects networking to expand enormously into many new areas in the next several years – all computing devices will be network devices, James Tolonen, executive vice-president and chief financial officer told the conference, echoing the pitch of Sun Microsystems Inc: the accelerating computing evolution will create a new value proposition for Novell, Tolonen said, with the future of networking including workgroup, enterprise, inter-enterprise and consumer markets, and Novell’s role will be to develop products that will make networks easier to access, simpler to use and more effective; Novell’s Corsair & Ferret product will address these concerns as it will feature Macintosh, Unix and Windows NetTop interfaces, he said, and will also provide a customisable three-dimensional real world interface and a next generation network browser, Tolonen said; it should start shipping by year-end.
Cypress Semiconductor Corp’s new chip fabrication plant now under construction will enable the company to push its capacity to produce $740m of annual revenues in two years, chief executive T J Rodgers told the San Francisco assembly: it will come on line next quarter and relieves the problem that capacity constraints for its static memory chips and communications parts have been a major problem for Cypress in the past year as Pentium designers push demand for cache chips; the company sees $550m sales this year; Cypress will sample its 3V 256K-bit static very shortly, but getting it up to volume will take 18 months.
Cirrus Logic Inc senior vice-president of corporate marketing George Alexy told the conference that the MiCrus manufacturing facility joint venture with IBM Corp is ahead of schedule – by the end of this quarter we would expect to have two products in volume production.
