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Technology Stocks : GX Investors Thread
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To: Spekulatius who wrote (116)8/23/2001 10:50:44 PM
From: David C. Burns   of 586
 
My 2B$ guestimate is simply based on an average 5 year depreciation time (linear) for 11B$ on assets. The ranges that GX gives for equipment are to wide (2-30 years) to estimate the depreciation rate of GX's assets. I'd guess that a router is virtually worthless after 2-3 years, but that fiber in the ground can be used 10-15 years. Robert Sheldon's estimate of 1B$ would imply a linear depreciation time of 11 years. This sounds very long to me -
who knows where fiber optics technology will be in 11 years?

I believe a rule of thumb is that the equipment to light up and operate fiber (in the ground or under the sea) is about 100x the cost of the fiber, so my first order estimate would say a higher number than linear depreciation is likely to be closer to the mark.
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