Did the entertainment companies lawsuit bankrupt Sonicblue?
Not even close. At the end, the lawsuit cost $1 million a month, and general expenditures were $7 million a month over that. What bankrupted the company was that we grew from an $18 million CE company to a $400 million CE company in 24 months and we never built the infrastructure to support it. We were leaving millions of dollars in the supply chain left and right. We had millions and millions of dollars in supply chain problems. Plus we were $56 million in debt from the purchase. But lawsuit was almost irrelevant, it represented only 3 percent of the expenses over a two-year period. What do you make of the file sharing of TV shows on the Net? Intentionally, we made certain that we didn’t have a clue about that stuff. I’ve never seen it, I’ve never tried it. We occasionally talked to people who were involved. But we didn’t know much of what was going on. You look at what gets file shared, it’s not what’s on TV. It’s to rip off movies still in theater that are not yet on DVD. Occasional
