Replies to post #37629 on e.Digital Corporation (fka EDIG)

[TOMMEEEK]

richard...Don't sweat it...August is really not that far away and she will be gone by then, right?....Enjoy the summer and be patient!

[Tinroad]

Richard, I never cease to wonder why any investor so thoroughly convinced that EDIG is a poor investment would waste so much time on it; especially someone who claims to be equipped to search out better places to invest. Very irrational behavior, especially in light of Matt's poll results indicating that the vast majority of board members are committed EDIG investors. Then again, the world is full of strange birds; the web is especially rife with them.

[owd3]

Maybe she just understands these market better than you do...

"I wonder why she cannot see the potential for success in light of the new products edig is about to enter the market with."

Maybe she understands that even if EDIG manages to bring these products to market, the products will be a financial disaster. Perhaps she understands that an under funded company like EDIG is going to get cut to shreds in any CE market they enter.

Maybe, unlike you, she can see that EDIG adds nothing to the CE process. If any of the products you allude to are even slightly successful, EDIG will quickly get cut out of the middle. They add no value beyond the test market/prototype stage.

And yes, the IFE, the F-T, and headphones are all test markets or worse at this point. 4000 units with no firm ongoing orders or a one-time $1M LOC are not exactly ringing endorsements of gearing up for great things.

[Cassandra]

She consistently dwells on the past and the financial problems during the last several years, which we all agree to, but never offers any thoughts in line with her so called expertise relating to the future.

RO: On the contrary, for the past couple of years I have posted about dismal prospects for this company ever becoming successful and that I think the stock will continue its downtrend back to historic .06 low and even lower. I've been right so far in my prospective projections on what is likely to happen with the company and its many hyped "deals."

e.Digital has always had products supposedly on the horizon that the company creates great expectations for. People have been making the exact same defense for years: "Forget the dismal past, look what's ahead... $10 million/yr Lanier contract, global standard royalties, Intel, Lucent, EASTECH, Maycom, Remote Solution/Hango, HyTek, DataPlay, Samsung, Toshiba, Musical, EDIG branded products, Circuit City, CompUSA, Good Guys, Hammacher Schlemmer, Skymal, college bookstores, broadband entertainment, DivX, $2.6 million in quarterly revenue, etc., etc., etc." See #msg-1082498 for more specific details.

Even when EDIG does get a deal, like B&O or Musical, the royalties are pathetically low. None of the HUGE deals projected for the future ever turn out to be significant. The branded products sold over the past 5 quarters cost more than twice the revenue (see #msg-1081900). This 15 year-old company can't even decide on a business plan and stick with it.

In the meantime, the company has burned through $65 million in investor-supplied funds, has used dilutive toxic financing repeatedly, obtained loans from offshore shells with outrageous terms, pays bills with stock and is about to register several million more conversion shares to for the Series D financing.

With a current ridiculous market cap of $30 million EDIG is amazingly overvalued. Even if the company could find a way to become profitable, the bloated number of shares outstanding will prevent the share price from any substantial appreciation. Additionally, I do not believe this management has what it takes to achieve major success and has proven to be untrustworthy in shareholder guidance.

FWIW, Of all of the deals EDIG is working on, I believe the Softeq one is the most substantial. The F-T deal has been delayed a year and is reminiscent of Lanier. Product will probably come out, but the financial impact to EDIG may not be great. I don't believe the APS deal will amount to much at all for EDIG as I believe the concept of using a HD-based portable device for a movie rental situation is wrought with potential problems. Using a portable DVD player like InMotion ueses, seems much more cost effective and desirable IMO. I also do not believe EDIG will ever get any kind of "bundling" deal and that royalties from DW will be a major disappointment.

I believe that e.Digital will eventually fail as a company and that those who never sell their stock are likely to lose all of their investment. EDIG may be a good stock for momo trading, but is a massive disaster as a long-term hold.