I had a great meeting with Chin Wu, co-founder and President of Acer Laboratories Inc . Mr. Wu is a very affable, and personable man. He was also very generous in sharing his thoughts on a number of general issues. ALi has a long history in the chipset business, and that makes Mr. Wu's veteran's perspective a nice reality check.

Chin Wu, Co-Founder and President of Acer Laboratories Inc.

I asked Mr. Wu to give me his views on a number of issues. His comments are italicized below.

Mr. Wu on the state of the economy: This year is very uncertain. Probably the worst economic environment in the last decade, particularly in the US and Taiwan. Because of a lack of economic growth we don't see people buying a lot of PCs. I know that many of the Fortune 500 companies are holding back their investments in hardware.

Intel and AMD: AMD can't really grow faster because of lack of capacity. Intel still owns sixty to seventy percent of the market. What Intel is afraid of most is the K7 killing P3 so, they are bringing in P4 aggressively.

People are wondering about Rambus's future. SDRAM is okay for a short period of time for P4. In the fourth quarter it's going to be more clearer.

Mr. Wu believes that Intel will look at the performance of RDRAM in the market in the fourth quarter, and if the company finds that RDRAM is not finding acceptance to the level it expects then, it may change strategy.

Mr. Wu said: DDR cannot be stopped. There's never been two standards for memory. It's doubtful Intel can afford two standards, Rambus and DDR. Rambus can be successful but it cannot dominate.

Here Mr. Wu pointed out that Rambus's royalty structure, which charges both memory makers and systems vendors, was unworkable. There are only about 20 memory makers, Mr. Wu pointed out, but there are literally thousands of systems houses that Rambus would have to support, and he didn't even think they had enough lawyers to deal with the royalty contracts.

However, Mr. Wu did go on to say: Intel is still dominant so, I am not discounting Rambus. It will be clear in the fourth quarter. If Rambus strategy fails, it's just one quarter for Intel.