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Technology Stocks : AUTOHOME, Inc

ATHM 24.34

-3.4%

Nov 7 9:30 AM EST

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To: Jack Hartmann who wrote (18970)	1/18/2000 8:08:00 AM
From: E. Davies	Read Replies (1) of 29970

I'll take a stab at it. You are saying that ATHM could deliver @Home into our territory cheaper than it would cost TCI to built their own network to compete against ATHM? TCI (which is AT&T) is the majority owner of @home. In essence the cable MSO's have gotten together to "build their own" and ATHM is the result. Why should they "build their own" again? If the cost of building the network for cable is expensive, then the DSL network must be at least 75% cheaper to start since we have at least four companies (Ameritech, GTE, Covad, UUNet) pushing DSL in Chicagoland to none for cable. The number of DSL companies is irrelevant, since they are all competing over the same wires. As I understand it DSL in general is less expensive to establish in urban areas where the distances to the central office tend to be short and cable finds it difficult to re-pull new wiring. The balance shifts in suburban and rural areas. I don't know how the reason why @home is not in your area, but it is a matter of cost/return economics. Only ~25% of all ATHM territory has been upgraded, they still have a lot of room to grow. My understanding is that DSL has been installed in even fewer areas. Did anyone on SI switch from DSL to cable Nobody yet has a feel how hard it might be to switch an established DSL user to cable or visa vera. One thing I can say is that in general cable can give you more for your money. Eric

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