[Sumitomo]
I too think the Sumitomo is very significant for several reasons. It appears to be the unfolding of AMTX's strategy implied within their 10-Q. I am guessing but AMTX probable feels the overseas market will more rapidly roll out xDSL for its' high end features such as video on demand which falls into the lap ADSL/DMT and not other xDSL flavors. In the US, my gestalt is that the lower forms of xDSL are being deployed first. Am I writing off the US for near/medium term deployment too fast? It would be nice if Microsoft began offering DMT only for MSN. They want to take over the world don't they? What better way than to offer the world standard? There is some ADSL/DMT competition for AMTX/NEC/Sumitomo in the orient from the Orkit/Fugitsu? alliance. As for Europe I don't think AMTX/Alcatel to be that profitable for AMTX as it is only royalty income. Who will be the "system integrator" in Europe to market AMTX manufactored products not just licensed products?
My thoughts focus on how AMTX will make money in addition concerns of not losing market share/mind share. As has already been posted AMTX will sell to OEM's and "system integrators" who will sell to Telcos. Knowing who are AMTX's system integrators is a major key. Companies such as TI, MOT, and NEC make the DSP's, etc. MOT and ?NEC will market their own products. AMTX "manufactures" its modems and multiplexor to sell primarily to system integators such as Sumitomo. This deal is sigificant. How does Sourcecom fit in other than testing compatibilty? A major system integrator, Alcatel, has alot of the US market tied up and only gives AMTX royalties (good enough for funding research only). AMTX potential product market left in the US is ISP's, Sprint, MCI, and GTE. Who is the system integrator who will sell to them? NEC/Sumitomo or a US company(s)?
I ask you alot of questions and don't expect you alone to aswer them all. Although, I very much appreciate your input. Focusing, on how the profits are going to be made...OEM's and system integrators seems to me key. Interestly, in AMTX's 10Q they appear to chose the OEM/system integrator route to decrease marketing expense. Selling modems to you and me would entail lots of marketing expense.
Appreciatively,
Mike Marsh
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