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Technology Stocks : LAST MILE TECHNOLOGIES - Let's Discuss Them Here
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To: MikeM54321 who wrote (4956)8/13/1999 9:16:00 AM
From: MikeM54321  Read Replies (2) of 12823
 
Re: MSO Cable Telephony Revenues / ILEC vs. Data CLEC

"Slow growing market? That's not relavant. It's market share that matters. AT&T will go from zero market share in local phone service, to who knows where but I guarantee it will be in the billions."

Thread,
In the FWIW column (all from a CNBC Faber report), an analyst at Merrill(?) came out today with an upgrade on Cox Communications. The reason: Circuit-switched telephony. He emphasized it was important to note it was circuit-switched. I'm assuming he meant, it's for real. He added he sees telephony adding $2.4 billion in revenues for Cox by year end 2000.

Where is the $2.4 billion coming from? An ILEC. I'm surprised that the ILECs are not being downgraded as cable telephony starts to come online.

If you think about it, what to do the ILECs have to compete with cable telephony? They have DSL. But the big theory was that ILECs didn't want DSL to cannibalize T1 revenues. But it's is starting to seem inevitable their old line broadband revenue source is going to suffer as it is replaced with less costly (to the customer) DSL services.

PS Well I see Faber (or I) read it wrong. Cox is going to grow overall revenues to $2.4 billion because of telephony. Roughly something like $.6 billion will probably be telephony revenues they don't have today. Still a substantial chunk.
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On the other hand, the FCC has now allowed ILECs to start competing head to head with the new data CLECs (DSL provider) invading certain parts of their territories. It's kind of complicated, but basically it means that it won't be as easy for a DSL provider to move in and undercut the ILEC when it comes to DSL service. So this should be interesting to watch. I've always wondered why the ILECs didn't just roll over the DSL providers. Maybe the FCC rules had previously prevented this.

I'm assuming this new FCC ruling is partly why the likes of COVAD have taken such a beating lately.

MikeM(From Florida)
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