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Technology Stocks : AUTOHOME, Inc

ATHM 23.51

+0.2%

10:15 AM EST

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To: ahhaha who wrote (13141)	7/30/1999 12:23:00 AM
From: Jing Qian	Read Replies (1) of 29970

Ahhaha, Thank you for the effort in providing your reasoning. They already have most of the market so how is this pertinent? When you have the lion's share and the market is nascent, you don't cut price. You might even raise it. That can't be done for appearance reasons. Att has enough bad PR going. I can see your points. But I can't totally agree. T doesn't own the lion's share of the entire broadband market. T only owns the majority of the cable market, if you say 25% is a majority. AOL can severely undercut AT&T's plan by rolling out the ADSL service with RBOCs faster. So the competition justifies that T takes drastic moves such as price cutting. I would agree with your points if T really have the lion's share. But they don't. it is impossible. Why give up the serve if you haven't faulted? What share would lowering the price get? The share that makes Att a formal monopoly? What makes you think increasing the subs number makes AT&T more of a monopoly than it is today? Whether they increase the sub number today or not, they will always be called a monopoly by somebody. The fault will not come from the service itself, but from competition from ADSL and Satellite, most notably ADSL. It's entirely possible that ADSL may catch up in a short time frame and eventually surpass Cable modem. In Bay area, Pacbell is aggressively pushing ADSL services in areas that @Home is not able to reach, such as San Jose and Santa Clara. Why not reduce the price now and slow the competition from ADSL in its infancy? You make more money by serving 100K people paying $20 than 6000 people paying $40. Isn't it simple math to you?

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