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Technology Stocks : Exodus Communications, Inc. (EXDS)
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To: Amy J who wrote (1387)10/11/1999 12:41:00 PM
From: SteveG  Read Replies (4) of 3664
 
<..What do you think about the challenge Barron makes regarding the lack of network ownership?..>

it's a very short-sited attack.

I asked Dick about this a couple months ago. His reasonable response was "why buy backbone now when a LOT more backbone will be coming online soon, providing better value?" i applaud that decision. it would be easy enough for EXDS to short term appease shareholders by capitalizing and depreciating backbone costs, but why not wait 6-12 months and get it appreciably cheaper?

and the article misquoted and misrepresented both Ellen and John Hodulik (who could tell by Einhorn's comments in the 15 minute discussion he gave her that she was gunning for EXDS).

John said EXDS's network costs were about 17%, and that they would come down to 12-13% (not 33% as the article said)

And Ebay's recent problems over the last several months had NOTHING to do with EXDS (even according to Ebay) - Ellen never said that. She also never refered to her data centers as a "roach-motel", and didn't say that what EXDS provides for $157,000 could be gotten elsewhere for $5-10K (i mean, gimme a break, who would even BELIEVE she would ever say stuff like that? most analysts who know Ellen *knew* the article was misrepresenting her before even confirming that with her)

Intel will NOT be a competitor to EXDS's market niche

There will be at minimum a Barrons Letter to the Editor from Ellen.

and fwiw, expect a Yahoo renewal and expansion (with likely a redundant relationship as Ebay recently signed with ABOV)
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