Hi, Rob -
"I've said this before on G&K and I'll repeat it here; capital scarcity is not visible until it's too late to do anything about it. Activity like we've seen in the last 2 weeks on the stocks of (for example) Worldcom, Qualcomm and Sprint are a shot across the bow; equity and debt markets will close to them unless they make a good business case for new investments. So far, they appear to be product and engineering driven efforts, not market-focused - that's a very bad sign."
Rob, I'm in total agreement with your comments. Anyone who has put their ear to the ground since 2000/2001, and listened for signs of a resurgence in sectoral liquidity/capex has been disappointed.
"...capital scarcity is not visible until it's too late to do anything about it..."
We both started looking for the resurgence in (ahem!) areas of telecom other than 3G, a couple of years ago. Time has only confirmed the rapid and continued desertion of the sector.
"...The only winners today are governments collecting juicy spectrum fees."
In Europe, regulatory agencies are permitting accomodations and relaxations that amount to a return of the fees collected, in order to prop up an industry, and its jobs. The collective spasm of greed and myopia has has brutal consequences. Two years ago, a Forrester report forecast that it would take until 2007, for a return to profitability in Europe - and that report assumed that the 3G buildout could, in fact, be financed.
Yes. Sectoral outflow: no doubt about it.
Also, JMHO.
Best regards,
Jim |
