CAWS - Wireless Cable (New and Improved) Message Board

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Technology Stocks : CAWS - Wireless Cable (New and Improved)

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To: Jose A. Suarez who wrote (546)	11/26/1996 10:28:00 PM
From: Mr.Creosote	of 5812

I am looking forward to see what path the management plans to take in the new year. Meanwhile, over the past few days I have thought about their bussiness and have come up with some advice to the CAWS management team (I sincerely hope one of them will read this). #1: Need to fundamentally change your company. Your have already demonstrated that your existing profit model doesn't work, it has not convinced anyone that it will ever work and you will continue to accumulate losses until you run out of cash and out of credit. (Take a look at your sister wireline cable companies and see how well they have done over the years.) #2: Wireless cable for delivery of TV services appears to be hopeless and this is becoming more and more evident with every passing day. Even if you can roll out a digital delivery service in late 1997 you are likely to be too late into the game having to fight the established wireline cable and the exploding 18-inch satellite dish market. By then you will have to be giving it away to get customers to switch to your service. Every day that goes by you are falling further and further behind to the satellite dish. You will never break even trying to sell 30, 60 or even 150 TV channels to the public. Every step of the way you will go further and further into the debt hole and you will not be able to climb out of. (Sorry I am so blunt but I can't say it any other way.) #3: Redirect your bussiness where there is growth opportunity and you have a unique advantage. Focus your efforts to the HIGH SPEED INTERNET ACCESS market where your number one near-term objective is to offer Megabit-class wireless one-way delivery of data to bussinesses and residences. This is where you have an edge, its what made your stock fly in May and this is how you can get back on top again. Downsize your wireless cable TV efforts and staff (you are losing customers and market share here) and save/redirect some funds from this process. Push the digital data delivery system very hard and allocate more 6MHz data channels to increase the download transmission bandwidth (Telco return will do for most people --forget the naysayers) at the expense of offering fewer TV channels. In parallel, work hard to resolve the technical problems associated with the digital delivery system and continue to work the 2-way wireless connection problem. Don't waste your money trying to increase your line-of-sight market (i.e., say from 50% to 75% as an example) but get something going SOON over your existing FOV. Get the right people to work the FCC side to get the right licences at the right time and reach out to your stockholders and tell them why they should believe in you. 2-way wireless megabit internet access is where you should be headed without a doubt, confusion, and WITH or WITHOUT BANX. Interactive services is the future and that's where you should steer you boat toward. Once that's achieved you can turn your attention to increasing LOS penetration, enhancing content or other projects but these can wait. #4: You have a tremendous opportunity in your hands, 1997 is the time to put it all together. Step out with a clear and simple plan. Execute and you shall be rewarded otherwise you will go the way of the cable companies. If you can't stay the course you started talking about back in May (on CNBC and elsewhere) you should step aside, selling out to a more determined leadership. You and only you can float this boat to the surface or sink it the rest of the way. Good luck whichever way you go. John Spanos

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