Replies to post #356886 on Zeev's Turnips Patch-No Politics (ZEEV)

[Bearmove]

By now SYNA should have come out with a press release clearing up this rumor. Since they have not I'd be real careful messing with the stock.

[John Jet]

Is what Apple story true? Track pads are pretty old technology, so there will be steady erosion. Scroll wheels are newer so it will take a while for Apple to find a second source. All these products have limited life cycles, like semis and non-generic drugs. You only invest in SYNA if you believe it can innovate faster than the rate of obsolescence.

There can be no denials because any replacement products are still under development, so nobody knows when or if or how viable. None of this is surprising. For Apple, sole sourcing is not an option.

[John Jet]

The other element in the Synaptics-Apple issue as to why there has been no press release or denial is the legal dimension. The agreements between Apple and Synaptics are confidential. Did Synaptics grant Apple a period of exclusivity for the ClickWheel [e.g., Zen Micro uses non-wheel interface] in return for a period of exclusivity as a sole-source provider? Fair question, but only the insiders know. Neither Apple nor Synaptics is going to tell us. Nor are their legal departments going to approve any hastily written press releases to calm the market when they have no legal responsibility to respond to rumors and whatever they say (or do not say) would become grist for the class action lawyers.