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Charlie,
Where do I begin.
"The Path to ADSL or -- A Trip from New York to California via Australia"
by Michael F. Donadio, investor
I bought Amati back in '95 convinced of the need for bandwidth and that DSL/DMT was the best solution. I thought everyone could see this as clearly as I could, and how the RBOCs would RUN to embrace it.--wrongo--RBOCs retarded DSL deployment and were their own worst enemy-- almost to the point of making the RBOCs obsolete!
AMTX partnered with MOT on its coppergold which failed to come out on time and seems to have remained mostly unsuccessful to the best of my knowledge.
When TXN bought AMTX (after grabbing AMTX from the pending merger with WSTL), I thought DSL deployment was imminent and that WSTL, with its relationship to TXN, would be the star -- wrongo--! Alcatel put itself on the map as the vendor of choice to the RBOCs gaining over 50% share worldwide. I still don't know what happened to that preferred relationship WSTL had with TXN, (I presume it is still there if and when TXN dsps prove to be the silicon of choice) but it became clear that it was ALA that WSTL had to align itself with.
During this period WSTL got its bad reputation as its share price dropped from $28 to just $2 something. (Actually it was a great buying opportunity that I availed myself of). I was sure DSL was just around the corner -- the RBOCs and the world wanted it. Still wrongo. We had another 1 1/2 years in WestHell as Ski and our lost enthusiast Trey used to call it.
Well, WSTL lost the CO business to ALA (except for what it wisely and shrewdly developed with Fujitsu), and concentrated on making the necessary CPE equipment with ALA chips -- and now there was a new twist -- glite. For expediency the world was going to go with glite. WHAT EXPEDIENCY! We still didn't have the RBOCs deploying and now we were going to a degraded 1.5 meg bandwidth for DSL. Alcatel and TXN said the secret was in the microfilters and the glite/full rate DSL issue changed focus. I saw DSL starting to come out but WHAT -- it was SDSL -- via CMTN -- with providers like COVD, Rhythms etc! CLECs were deploying without WSTL! Where was ADSL, where was WSTL, where were the RBOCs.???
Now we have finally reached the ILEC deployment of ADSL, which was enabled by the Nov.'99 FCC ruling and which took effect as of June of this year. To my surprise, however, EFNT which IPOed last fall became perceived as the market leader in the forthcoming ILEC deployment of DSL. EFNT has a substantial backing from TXN. WSTL's poor performance in the years prior to the ILEC deployment had tarnished WSTL's reputation.
Now the ILECs are trying to make up for lost time. The main ingredients I see in the WSTL modems, to the best of my knowledge, now come from VIRATA, a well focused company who is using TXN dsp's that they program via SSPI, not Amati, and combine them with ALA compatible chips that they have fabricated. The fact that they do a great deal of the software development allows for decreased costs to OEMs. I would really like to know more about how this all came about.
The only thing I had right was that WSTL would eventually be a star. I knew it had some of the brightest engineers around and was COMMITTED to DSL. They never took their finger off of DSL's pulse. WSTL was hurt by thinking too far ahead, something which is usually good except when dealing with the RBOCs whose vision is very limited.
Now all I wait to see is WSTL garner the share price it truly deserves which IMO should exceed that of EFNT. The latest quarterly report justifies to me such a price and has me smiling from ear to ear.
You guys at WSTL, if you read this, thanks for vindicating those investors who have stayed with you during those tenuous years believing that when DSL rolled out, you would be leading the carpet.
All the best,
Michael
P.S. I wonder what the path to VoDSL will be like? |
