Eli’s Globes’ Interview

On 19 December, the Globes online (English) published provocative excerpts from an interview with Eli Harari: “SanDisk’s Harari: Steve Jobs Should Be Afraid.”

The full interview was only available in Hebrew in the Globes weekend magazine “G.” Since I neither speak Hebrew nor live in Israel, I asked an Israeli friend whether there was additional info in the full Hebrew version. Turns out there was. My friend’s comments:

About Jobs he said “a man of vision, genius, but not nice, concentrating on himself. He wants things to be done as he sees it and if not go to hell. He forced NOK MOT or Samsung to fixed price for content. The iPod is great but not without mistakes. We prefer friendly players with close cooperation with the content providers. Jobs can fire a manager that is not doing what he told him but I prefer to be collegial to my managers.

The market goes to phones. We sell cards to all the phones. Also AAPL knows that the [MP3] players are not the biggest market. We sold 42m cards on Q3 and AAPL sold 100M ipods in 6 years. Jobs should be afraid, not only of SNDK but also of others that can innovate. A company must not rely on one guy who might get tomorrow morning an heart attack. My mission is not to destroy AAPL but to take market share.”

He says TakeTV which sells for $99 is a great product and AppleTV which sell for $300 is terrible (“sin”) “and Jobs knows it. Content providers do not like to work with AAPL and they come to us like CBS and soon more.” About SNDK plans regarding the players, he says that they will target 35% of the market (looks like world market) by creating new categories “in cheap players, $100 and less we will be very strong”. “Mothers ask children to download music to the iPod because it is not easy like the Sansa”

About Dov the reporter says that rumors are that Dov is developing a Harari vision which is a flash-based phone with all the functions like pc music browsing video camera etc. “Mothers of All Markets” as once Eli said the reporter says. The reporter says Eli is controlling the activities of Infone but Eli denies and says “SNDK has less than 50% and I am not in the board. No one can control Dov. He invested huge personal money. He has an excellent vision but the market is very competitive and he has to prove himself. If he will succeed he will change the market. I want to help him because I believe in him and the his vision is right but it all depends on execution since he took on himself a huge mission”.

SanDisk Commentary or Shades of iDon’t

For all of Eli’s bluster here, Apple has been a blessing for SanDisk and Eli knows it. With products like the iPod and iPhone, Apple has been creating markets for SanDisk and soaking up something like 1/4 of the world’s NAND supply in the process.

In a more reflective moment at SanDisk’s February 2007 analyst day, Eli only had good things to say about Apple:

“I would like to say, I couldn’t ask for a better company for us than Apple from the point of view of tremendously good work that they are doing in creating new markets and in the process not just creating new markets but creating tremendous opportunities for companies such as SanDisk”

Until SanDisk actually delivers a better product than Apple, to my mind, SanDisk would be better served taking this high road. Also, with Apple stock hitting new highs while SanDisk is bumping along at 52 week lows, Apple-bashing rings rather hollow.

Apple-bashing has a history with SanDisk. Back in 2006, a low point was reached when SanDisk launched its iDon’t campaign, “an all-out, guerrilla attack on the iPod”

idont.jpg

SanDisk’s iDon’t campaign was roundly ridiculed. Rightly so.

Infone-tech becomes Modu

It appears that Dov has sharpened the focus of his new company. Infone-tech has morphed into Modu. Based on unsubstantiated rumors and wild guess-work, I suspect Dov is now focussed on mobile opportunities in emerging markets.

In looking over the Modu job listings, a number of jobs refer to developing for a “unique cellular system.” My guess is that whatever this unique cellular system is, it is the key to what Dov is up to. Also likely this is one of Dov’s key new inventions. I suspect that “unique cellular system” translates as a “unique twist on existing cellular systems.” Time will tell.

There are also references to jobs related to a SDK, software development kit. This would seem to imply Dov is developing some kind of platform that others will be able to write programs for.

I have been thinking about the (last) company name “Infone-tech.” This might have referred to a technology/product to be “In-Fones” or “Inside Phones” or alternatively a technology to put phone technology inside other devices.

Another interpretation is that “Infone” was short for “Info-fone” or “Information-Phone.”

Information Phone could be interpreted as a smart phone or a phone with data functionality like the iPhone or Android-based Phone. It could also be a module which would turn a phone into a smart phone.

Such an interpretation ties back nicely to the the reporter’s speculation in Eli’s Globes’ interview that Dov is developing “ a flash-based phone with all the functions like pc music browsing, video camera, etc.”

A smart phone (or related “modu”-le) for emerging markets would be very ambitious. Success would seem to hinge on Dov’s latest invention, whatever that twist may be. I am looking forward to 3GSM in February when the secret, whatever it is, will likely be revealed.

Tomorrow at SanDisk’s CES Press Conference according to SanDisk’s press release:

“SanDisk Chairman and CEO Eli Harari will present a new perspective on the company during the press conference, and will discuss new products.”

As far as what the “new perspective” might be, my guess is that we will hear more about SanDisk’s Digital Content Strategy. New products will no doubt include TakeTV, FanFare, and Vaulter. Additional possibilities include an MLC SSD, a video-centric Sansa and/or OTP cards for retail — all products likely in SanDisk’s 2008 pipeline.

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One Response to Eli’s Globes’ Interview

  1. Poofypuppy says:

    Hi Savo,

    I don’t follow the SNDK Yahoo message board too much these days (too many junk posts), but did notice one that mentioned a patent for 3D. I’m not much on patent searching, but think this might have been the one being touted (patent 7,319,053)…
    http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO2&Sect2=HITOFF&u=%2Fnetahtml%2FPTO%2Fsearch-adv.htm&r=2&f=G&l=50&d=PTXT&p=1&p=1&S1=((SanDisk+AND+3D)+AND+memory)&OS=SanDisk+AND+3D+AND+memory&RS=((SanDisk+AND+3D)+AND+memory)

    Would be interested in your thoughts. Is this the “big one” (heralding the arrival of rewritable 3D flash) or just another link in the patent chain that is needed?

    Thanks,
    Poofy

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