<xDSL is real and will be deployed on a grand scale, do you agree?>
If by grand you mean industry expectations of into the billions in 4-5 years, yes, I think those are not unreasonable guestimates. I think for THAT level of deployment however, the technology has to be fairly idiot proof (for the telcos) to use. Otherwise, they will be spending more per line in maintainence/trouble-shooting than it is worth.
Shorter term trials under the watchful eye of trained telecom engineers is one thing. Mass deployment to every CO is another. The industry is working toward a telco turnkey solution. I'm pretty sure this is do-able - but not sure of the time frame. Truth is NO one will REALLY know how stable ADSL systems will be on a massive deployment over time until it is done. Trials DO give some insight.
The other question will be how much will it cost telcos, once they KNOW it is stable, and will it be a money maker? Did you see the recent post on the MIT study that said without a switched/metered solution (such as "DAM"), even at $0 for the telco equipment, ADSL is not profitable? How much an end user is willing to pay for this bandwidth, and what they will get for their dollars will be the determining factor.
And I don't mean you or I. I mean the vast majority of people who are far less computer savvy, much less internet savvy, than the SMALL minority we compose. And even I who could easily afford it, wouldn't pay $50/month (let alone charges/minute) just to load web pages faster. Currently, E-mail is the ONLY "killer" internet app, and it doesn't NEED bandwidth. So until something comes along to make it COMPELLING to buy bandwidth, such that it is profitable for the telcos to mass deploy, I think ADSL may NOT live up to even Dataquests recent DOWNWARD projections for deployment. Though it also certainly COULD. But IMO, it is not a "lay-up".
<Point being that all xDSL companies will reap rewards far beyond what
even most investors can even dream off over the long haul.>
I disagree strongly that this is a "given", for the above reasons, as well as the fact that if ADSL really does kick in, it will likely become a commoditized business (like cable modems - which are not an insignificant source of competition for ADSL, and a tech that will KEEP the ADSL margins competitively low) with slim margins that only the largest suppliers will be profitable from.
COULD all ADSL companies reap dreamy rewards? Sure, they might. Is it a "no-brainer" that ALL will? Not in my opinion.
<So even Grand Standing exuberance by some investors in any of xDSL stocks is well justified IMHO.>
Spoken like a TRUE (not so "humble") BELIEVER.
I guess it's just a matter of style, but I don't think ANY stock justifies "Grand Standing exuberance". Maybe it's my training, maybe my experience in the market, and maybe it's just a disinclination to fanaticism. So we are on opposite ends here.
I'm not one for religious-type conversions to publically traded companies, and I don't have a good feeling when people get wild-eyed and throw all caution and sense of perspective to the wind. Some people seem to NEED that kind abandon in their lives. I just don't think the stock market is the best place for these kind of passionate/devotional sentiments.
But I do hope Amati makes a lot of money for everyone. I just don't think people should plan their retirement around ANY stock, especially not a high risk venture such as Amati.
My two cents
Regards-
Steve
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