You, too, have a point.
Let's look squarely at that worst-case. Let's say 3G is dead. Or going into hibernation for a long enough time, that (from the viewpoint of investors) it looks dead. Let's say the only killer app for wireless is voice.
Can you find any articles in the business press, currently, which say anything other than:
1. 3G timetables are very uncertain
2. 3G has no apps, no proven markets
3. the companies that were expected to pay for the 3G buildout can't
4. the industry is in a liquidity crisis, everyone is desperately conserving cash.
At a stock price of 40, how much future profit stream from non-voice 3G is, today, in the stock? How about at a stock price of 25? At 25, I'd say that the stock price is entirely based on the existing 2G footprint. Which isn't likely to go away. At 40, the stock price is still just pricing in existing 2G, and a reasonable extrapolation of 2.5G revenues, but still nothing from 3G. Only above 50 or 60 are expectations for 3G built into the stock. |
