Technology Will Save The World

[bargainman]

I'm just weeks away from finishing a bachelor's degree in computer science, and so my circle of competence essentially consists of technology. I know that a lot of capital expenditure is necessary to stay ahead in the tech industry, but I also have some idea of what makes a good tech company or a bad one, having worked for several. I'm going to start researching Intel, since they have a processor in every PC and Mac. I don't even need to be right about Microsoft v. Google v. Apple, they all use Intel hardware.

 

The iPhone and iPad don't.  Check the number of sales of macs vs iPads/iPhones in Apple's 10K and you'll understand the importance of that.  Also, there probably aren't many Android or Windows phones that do either.  Not saying Intel isn't a good buy, but just make sure you understand where we are and where we're going.  And most of all what is Intel's competitive advantage?

[mikazo]

I'm just weeks away from finishing a bachelor's degree in computer science, and so my circle of competence essentially consists of technology. I know that a lot of capital expenditure is necessary to stay ahead in the tech industry, but I also have some idea of what makes a good tech company or a bad one, having worked for several. I'm going to start researching Intel, since they have a processor in every PC and Mac. I don't even need to be right about Microsoft v. Google v. Apple, they all use Intel hardware.

 

The iPhone and iPad don't.  Check the number of sales of macs vs iPads/iPhones in Apple's 10K and you'll understand the importance of that.  Also, there probably aren't many Android or Windows phones that do either.  Not saying Intel isn't a good buy, but just make sure you understand where we are and where we're going.  And most of all what is Intel's competitive advantage?

 

I realize that Intel hasn't broken into the mobile market yet, but I don't see laptop or desktop or data center computers going away any time soon. Intel has been working on smaller, low-power processors such as the Atom too. The competitive advantage that Intel holds is that they are the inventors and biggest suppliers of the IA-32 and IA-64 architectures. http://en.wikipedia.org/wiki/IA-32 If they make changes to the architecture, companies like AMD and others simply have to adapt to whatever changes Intel makes. Intel is also starting to offer complete hardware/software solutions that are tightly integrated with each other. I haven't delved into any annual reports or quarterly webcasts yet, I'm just at the idea phase so far.

[rkbabang]

I'm a tech guy as well, although more on the hardware side (I'm an IC designer).  You are correct in that Intel isn't going away anytime soon.  They have a stable business and are clearly the market leader by quite a long way when it comes to desktop PCs, workstations, servers, etc.    But where will the future growth come from?  If you want a growth story starting from a smaller base and representing more of where we are going you have to take a hard look at ARMH.  ARM has a great business in the mobile processor space and also a long held deeply entrenched position in the IP business (embedded processors / standard cell libraries / as well as various other IP) so that it isn't going away any sooner than Intel will, yet its embedded processor business will almost certainly grow faster than any business Intel is in. I haven't done any research into these companies recently as far as the stocks go so I won't speak to their current valuations, but I think as far as where the technology is headed ARM is in a much better position to take advantage of current and near-term trends.

 

Also one word of advice on circle of competence.  You can (and probably should) work on building a circle of competence for investing purposes in a number of areas outside of technology and I highly recommend you do so.  As a recent college grad in the mid-90s I used to invest exclusively in tech stocks, because I believed that I should stick to what I know best.  Needless to say I got hit pretty hard by the tech crash of 2000 and have been working on extending my circle of competence into other areas for investing purposes ever since.  I have been investing in restaurants, restaurant equipment companies, insurance companies, construction/farm equipment companies, and with ISRG, a surgical device manufacturer.  The only tech stock I now own is GOOG and restricted stock in the semiconductor company that I work for.  I'd highly recommend picking an industry that interests you outside of technology and start doing some research and trying to build some competence in that area.  It can never hurt to widen your circle, especially when your initial circle of competence only includes one industry which is very difficult to invest successfully in.

[rkbabang]

I also forgot to mention that Windows 8, which will be released this year will support ARM processors as well as Intel.  You could very well see an ARM based PC running windows.  I'm not sure how likely that will be for desktops or workstations, but you will almost certainly see, not only ARM based Windows 8 tablets, but laptops as well.  This will erode Intel's moat even further as ARM eats into its Windows laptop market share.

[TorontoRaptorsFan]

There's an application which utilizes the cloud to allow you to use the iPad to use Microsoft apps (Word, Excel, Powerpoint) and Flash.

 

http://desktop.onlive.com/

 

 

 

 

[TorontoRaptorsFan]

The advances in quantum computing are stunning. By 2015 Moore's law will eventually reach it's endpoint with silicon transistors so what's the solution?

 

IBM has been making some significant progress with quantum computing.

 

 

 

 

 

[rkbabang]

The advances in quantum computing are stunning. By 2015 Moore's law will eventually reach it's endpoint with silicon transistors so what's the solution?

IBM has been making some significant progress with quantum computing.

 

I suspect you're probably 8-10 years off wrt the end of silicon transistors.  If I was a betting man I'd wager that Intel will find a way to manufacture some form of CMOS down to around 4nm device sizes.  Which is a lot smaller than most people are assuming to be possible currently and which will put us well into the 2020's and even that will not be the end of Moore's Law as processing at the molecular and atomic level will follow. But I agree with you about quantum computing, it is coming.  It works differently than traditional computers however.  It can solve problems quickly that traditional computers can not solve at all, but does not work well for traditional type sequential programs.  I suspect you will eventually see a quantum processor sitting next to a multi-core traditional Von Neumann type processor working together.  The traditional micro will run the program and offload certain things to the quantum co-processor.

 

One other thing that will be interesting is the development of neural-network-brain-type processors using memristors.  Maybe in the medium-to-long-term there will be systems that contain massively multicore Von Neumann CPUs with quantum co-processors all controlled by a neural-memristor processor.

 

We are at the very beginning of all this stuff, most people have no idea what's coming.

 

[TorontoRaptorsFan]

I've been reading more and more that graphene will be the solution after silicon. I agree with you that silicon will be maximized until they can't eek out any more out of it. Then I think graphene will take over.

[bargainman]

Does that date take into account the recent 3D Tri-Gate transistor tech?

 

http://newsroom.intel.com/docs/DOC-2032

 

Anyone know much about this?

[rkbabang]

Does that date take into account the recent 3D Tri-Gate transistor tech?

http://newsroom.intel.com/docs/DOC-2032

Anyone know much about this?

 

Absolutely.  This is what Intel came up with to make CMOS work at the 22nm node.  Many people are assuming that there is only one or two shrinks possible from here, maybe maxing out around 12-14nm.  I think with billions of dollars thrown at these problems Intel or some other company will find a solution to take us to 7-8nm then down to about 4nm.  At 4nm the transistors would literally be a few atoms wide so that will be about the physical limit of silicon and some other type of device, most likely made of some form of carbon will need to be developed for Moore's Law to continue.

 

--Eric

 

[TorontoRaptorsFan]

An interesting solution to wirelessly charging electric vehicles.

 

 

 

[ERICOPOLY]

A mouthwash that selectively kills only the cavity-causing bacteria -- leaves the other bacteria alone:

 

http://www.dentistry.ucla.edu/news/new-mouthwash-targeting-harmful-bacteria-may-render-tooth-decay-a-thing-of-the-past

 

 

Dental caries, commonly known as tooth decay or cavities, is one of the most common and costly infectious diseases in the United States, affecting more than 50 percent of children and the vast majority of adults aged 18 and older. Americans spend more than $70 billion each year on dental services, with the majority of that amount going toward the treatment of dental caries.

 

[beerbaron]

A mouthwash that selectively kills only the cavity-causing bacteria -- leaves the other bacteria alone:

 

http://www.dentistry.ucla.edu/news/new-mouthwash-targeting-harmful-bacteria-may-render-tooth-decay-a-thing-of-the-past

 

 

Dental caries, commonly known as tooth decay or cavities, is one of the most common and costly infectious diseases in the United States, affecting more than 50 percent of children and the vast majority of adults aged 18 and older. Americans spend more than $70 billion each year on dental services, with the majority of that amount going toward the treatment of dental caries.

 

Hopefully P&G will not buy the patents...

 

BeerBaron

[lessthaniv]

Recently, I was invited to sit in on Tim McElvaine's investor day in Vancouver. Tim briefily discussed the technology of 3D-Printing and the implications that could have to manufacturers. China, really seems under invested in technology because labour has always been so cheap.

 

http://en.wikipedia.org/wiki/3D_printing

 

 

[ERICOPOLY]

A mouthwash that selectively kills only the cavity-causing bacteria -- leaves the other bacteria alone:

 

http://www.dentistry.ucla.edu/news/new-mouthwash-targeting-harmful-bacteria-may-render-tooth-decay-a-thing-of-the-past

 

 

Dental caries, commonly known as tooth decay or cavities, is one of the most common and costly infectious diseases in the United States, affecting more than 50 percent of children and the vast majority of adults aged 18 and older. Americans spend more than $70 billion each year on dental services, with the majority of that amount going toward the treatment of dental caries.

 

Hopefully P&G will not buy the patents...

 

BeerBaron

 

Hadn't thought of that.

 

What I'm wondering is how much will they need to charge for a child's braces if the dentists lose "the majority" of an annual $70b business?

 

[StubbleJumper]

A mouthwash that selectively kills only the cavity-causing bacteria -- leaves the other bacteria alone:

 

http://www.dentistry.ucla.edu/news/new-mouthwash-targeting-harmful-bacteria-may-render-tooth-decay-a-thing-of-the-past

 

 

Dental caries, commonly known as tooth decay or cavities, is one of the most common and costly infectious diseases in the United States, affecting more than 50 percent of children and the vast majority of adults aged 18 and older. Americans spend more than $70 billion each year on dental services, with the majority of that amount going toward the treatment of dental caries.

 

Hopefully P&G will not buy the patents...

 

BeerBaron

 

 

I don't get it?  Why would it be bad if P&G bought the patents?  They certainly have the production, distribution and marketing capacity to profitably deliver such a product to consumers....

[sswan11]

Intel is expanding massively in Oregon, competitive advantage is the "moat" of fabs capital investment.  Article in this week's Barron's:

 

http://online.barrons.com/article/SB50001424053111903964304577418241846096930.html#articleTabs_article%3D1

 

I listened to a lecture by Dr. Leroy Hood at University of Washington (one of early Human Genome Project researchers);  he predicts "embedded" processors collecting organ-specific real-time data will revolutionize medicine w/in next decade;  "billions of data points". 

 

ps.  As ancient as I am I just completed a graduate certification in Bioinformatics at Oregon Health Science University, funded by Uncle Sam (part of requirement for hospitals/physicians to adopt electronic medical records by 2014)!

 

http://en.wikipedia.org/wiki/Leroy_Hood

[ERICOPOLY]

A mouthwash that selectively kills only the cavity-causing bacteria -- leaves the other bacteria alone:

 

http://www.dentistry.ucla.edu/news/new-mouthwash-targeting-harmful-bacteria-may-render-tooth-decay-a-thing-of-the-past

 

 

Dental caries, commonly known as tooth decay or cavities, is one of the most common and costly infectious diseases in the United States, affecting more than 50 percent of children and the vast majority of adults aged 18 and older. Americans spend more than $70 billion each year on dental services, with the majority of that amount going toward the treatment of dental caries.

 

Hopefully P&G will not buy the patents...

 

BeerBaron

 

 

I don't get it?  Why would it be bad if P&G bought the patents?  They certainly have the production, distribution and marketing capacity to profitably deliver such a product to consumers....

 

Well, it does threaten the cavity-fighting toothpaste market.

 

And a mouthwash that is effective for 4 days after a single rinse might threaten the twice-a-day rinse market.

 

People buy fancy toothbrushes that vibrate or have special "reach" capability.

 

They could be tempted to just buy the patent and never roll out a product.

[StubbleJumper]

A mouthwash that selectively kills only the cavity-causing bacteria -- leaves the other bacteria alone:

 

http://www.dentistry.ucla.edu/news/new-mouthwash-targeting-harmful-bacteria-may-render-tooth-decay-a-thing-of-the-past

 

 

Dental caries, commonly known as tooth decay or cavities, is one of the most common and costly infectious diseases in the United States, affecting more than 50 percent of children and the vast majority of adults aged 18 and older. Americans spend more than $70 billion each year on dental services, with the majority of that amount going toward the treatment of dental caries.

 

Hopefully P&G will not buy the patents...

 

BeerBaron

 

 

I don't get it?  Why would it be bad if P&G bought the patents?  They certainly have the production, distribution and marketing capacity to profitably deliver such a product to consumers....

 

Well, it does threaten the cavity-fighting toothpaste market.

 

And a mouthwash that is effective for 4 days after a single rinse might threaten the twice-a-day rinse market.

 

People buy fancy toothbrushes that vibrate or have special "reach" capability.

 

They could be tempted to just buy the patent and never roll out a product.

 

I'm not sure that people would stop using Crest or Scope just because this product kills the worst bacteria.  There's nothing quite as nice as brushing your teeth in the morning.

 

More likely that they'd roll out the product and price it at a point where they'd earn equivalent or higher profits from each user (hey, I'd consider paying $100/year to beat the tooth decay problem).  My suspicion is that insurance policies would probably provide coverage for the initial years, as it would be a no-brainer to reduce their costs.

 

After the patent expires (and there would probably be less than 15 years to exploit it), then every Tom, Dick and Harry could probably produce the stuff at a price competitive with current mouthwashes.  Eventually P&G would have to drop their prices in preparation for patent expiration, but it could be a great run for the first 10 years.

[ERICOPOLY]

Shi has been working on the innovation for over a decade with support from Colgate-Palmolive and a company he founded, C3-Jian Inc.

 

http://losangeles.cbslocal.com/2011/11/19/ucla-microbiologist-develops-smart-bomb-against-cavities-tooth-decay/

[KFRCanuk]

Recently, I was invited to sit in on Tim McElvaine's investor day in Vancouver. Tim briefily discussed the technology of 3D-Printing and the implications that could have to manufacturers. China, really seems under invested in technology because labour has always been so cheap.

 

http://en.wikipedia.org/wiki/3D_printing

 

http://blip.tv/makerbot/the-colbert-report-featuring-bre-pettis-ceo-of-makerbot-june-8-2011-5262194.

 

[ERICOPOLY]

I'm not sure that people would stop using Crest or Scope just because this product kills the worst bacteria.  There's nothing quite as nice as brushing your teeth in the morning.

 

Scope kills all of the bacteria in your mouth, even the ones that fight infection and disease.

 

Why would you continue to purchase mouthwash that kills helpful bacteria?

 

You wouldn't.

 

The marketing campaign for the new mouthwash would inform you about the benefits of certain oral bacteria.

 

http://en.wikipedia.org/wiki/Oral_ecology

 

As mentioned, oral bacteria also help fight disease-producing germs that try to come in through the mouth. These bacteria work with our immune system to keep our bodies disease free. For example, some of these bacteria produce organic acids that kill the organisms that cause intestinal problems.[2] Without these good bacteria, our immune systems would be constantly bombarded by airborne and saliva-transferred germs. Bacteria are also needed to control the growth of fungus. “Balance between all the different bacteria and fungus are critical” or else the “fungus overgrows and takes over.”[10] So, ironically, though bacteria have the potential to harm us, our mouth and the good bacteria in it are the body’s first line of defense.

 

[StubbleJumper]

I'm not sure that people would stop using Crest or Scope just because this product kills the worst bacteria.  There's nothing quite as nice as brushing your teeth in the morning.

 

Scope kills all of the bacteria in your mouth, even the ones that fight infection and disease.

 

Why would you continue to purchase mouthwash that kills helpful bacteria?

 

You wouldn't.

 

The marketing campaign for the new mouthwash would inform you about the benefits of certain oral bacteria.

 

http://en.wikipedia.org/wiki/Oral_ecology

 

As mentioned, oral bacteria also help fight disease-producing germs that try to come in through the mouth. These bacteria work with our immune system to keep our bodies disease free. For example, some of these bacteria produce organic acids that kill the organisms that cause intestinal problems.[2] Without these good bacteria, our immune systems would be constantly bombarded by airborne and saliva-transferred germs. Bacteria are also needed to control the growth of fungus. “Balance between all the different bacteria and fungus are critical” or else the “fungus overgrows and takes over.”[10] So, ironically, though bacteria have the potential to harm us, our mouth and the good bacteria in it are the body’s first line of defense.

 

 

Sure, I buy the argument that one product might be better than the other.  What I am questioning is whether the introduction of the novel product would completely alter our oral hygiene routine.  By that, I mean that it is somewhat difficult to believe that people would abandon the daily routine of brushing and rinsing, and instead use a new rinse that is required only twice per week.  In my case, I tend to think that I'd continue brushing and continue using some sort of daily rinse...even if the daily rinse were some variation of the new product (at a higher price). 

 

All this to say that I'm having a hard time seeing how the newer superior product wouldn't result in incremental revenues (because you'd price it higher), but I acknowledge that it might cannibalize the existing rinse sales.  In other words, it would be  an incremental return from product differentiation in a market that is otherwise characterised by undifferentiated products (ie, Scope and Listerene are pretty much interchangeable).

 

Now if they could just invent a wash that would completely eliminate the need to floss..... ::)

[ERICOPOLY]

I'm not sure that people would stop using Crest or Scope just because this product kills the worst bacteria.  There's nothing quite as nice as brushing your teeth in the morning.

 

Scope kills all of the bacteria in your mouth, even the ones that fight infection and disease.

 

Why would you continue to purchase mouthwash that kills helpful bacteria?

 

You wouldn't.

 

The marketing campaign for the new mouthwash would inform you about the benefits of certain oral bacteria.

 

http://en.wikipedia.org/wiki/Oral_ecology

 

As mentioned, oral bacteria also help fight disease-producing germs that try to come in through the mouth. These bacteria work with our immune system to keep our bodies disease free. For example, some of these bacteria produce organic acids that kill the organisms that cause intestinal problems.[2] Without these good bacteria, our immune systems would be constantly bombarded by airborne and saliva-transferred germs. Bacteria are also needed to control the growth of fungus. “Balance between all the different bacteria and fungus are critical” or else the “fungus overgrows and takes over.”[10] So, ironically, though bacteria have the potential to harm us, our mouth and the good bacteria in it are the body’s first line of defense.

 

 

Sure, I buy the argument that one product might be better than the other.  What I am questioning is whether the introduction of the novel product would completely alter our oral hygiene routine.  By that, I mean that it is somewhat difficult to believe that people would abandon the daily routine of brushing and rinsing, and instead use a new rinse that is required only twice per week.  In my case, I tend to think that I'd continue brushing and continue using some sort of daily rinse...even if the daily rinse were some variation of the new product (at a higher price). 

 

All this to say that I'm having a hard time seeing how the newer superior product wouldn't result in incremental revenues (because you'd price it higher), but I acknowledge that it might cannibalize the existing rinse sales.  In other words, it would be  an incremental return from product differentiation in a market that is otherwise characterised by undifferentiated products (ie, Scope and Listerene are pretty much interchangeable).

 

Now if they could just invent a wash that would completely eliminate the need to floss..... ::)

 

Yes, that makes sense.  Gingivitis is still a problem, as is yellow teeth, "furry feeling" on the teeth, bad breath, etc...

 

The rinse that also controls gingivitis/gum disease is probably coming next -- it is a different bacteria that needs to be targeted.

[ragnarisapirate]

A mouthwash that selectively kills only the cavity-causing bacteria -- leaves the other bacteria alone:

 

http://www.dentistry.ucla.edu/news/new-mouthwash-targeting-harmful-bacteria-may-render-tooth-decay-a-thing-of-the-past

 

 

Dental caries, commonly known as tooth decay or cavities, is one of the most common and costly infectious diseases in the United States, affecting more than 50 percent of children and the vast majority of adults aged 18 and older. Americans spend more than $70 billion each year on dental services, with the majority of that amount going toward the treatment of dental caries.

 

Dentists will also have a strong reason to discredit this product... After all, they could lose a great source of revenue (cavities). It's kind of like how Valvoline and other oil change places try to get you to change your oil every 3K miles, despite not really needing to- not only are oils much better today than they were a while back, but, cars also are made so that the manufacture tells you to often wait for longer periods of time.

 

 

 

Hopefully P&G will not buy the patents...

 

BeerBaron

 

 

I don't get it?  Why would it be bad if P&G bought the patents?  They certainly have the production, distribution and marketing capacity to profitably deliver such a product to consumers....