[point-counterpoint]
good post. i'm in a hurry, let me respond point-by-point.
<<Mark, it is a big step from "no one has seen their modem" to "hasn't participated in real-world trials". Clearly, the truth lies somewhere in between.>>
i'm aware (no pun intended) of exactly two sitings of working Aware-based ADSL modems ever. these are the teledotcom test and the early phase of GTE trials, where apparently Aware got disqualified pretty early. compare that meager exposure to the well over 100 trials that WSTL, AMTX, ALA, ORCTF and others are doing. the telcos aren't just kicking the tires of the modems; they're kicking the tires of the vendors as well.
<<I believe that if there were any serious deficiencies in the Aware modems, then it would have turned up in the lab reports. This doesn't mean that it will perform flawlessly in the field, but any deficiencies should be relatively straightforward to correct. I don't see this as a big matter.>>
this is howlingly naive. this is so completely wrong that i should stop here. please don't tell me you're an engineer...
<<Amati has SERIOUS money problems and I am not impressed with their management.>>
I'm trusting management's guidance that money isn't a problem. Also i expect that the two borkerages that recently raised their rating on AMTX did their homework on the financials and weren't shocked. With the BCTel contract in hand, AMTX shouldn't have a hard time securing a line of credit if needed. They could also do a two million share secondary offering that wouldn't significantly dilute but would kick $22-30M into the coffers.
what don't you like about AMTX management?
<<I think that Aware has a very strong (at least I strongly hope) management team>>
if you're bringing your hopes into it, that's a danger sign. i was very unimpressed with their preparedness and forthrightness at their most recent conference call.
<<and that they will be able to fix together all of their disjointed pieces (USRX, DSC, ASCEND, ...) into a strong coherent structure, which will produce a reasonable profit.>>
AWRE isn't going to be a big growth stock by just getting royalties from chip sales. Charles Pluckhahn at Dain Bostworth, in his AMTX upgrade, estimated that Amati will get around $500 per modem in the BCTel contract. Q: How much do you think Aware will get for each ADI/AWRE-based modem sold? A: A whole lot less, as in pennies on the dollar. Ditto for AMTX on other companies' CopperGold-based modems.
<<So far, I have been pretty impressed with Aware's management.>>
Especially Jim Bender's recent wholesale selling of AWRE shares?
<<They run a pretty tight ship financially, while not skimping on R&D.>>
Did you listen to the same conference call I did? They are under budget on R&D spending! they're having a hard time hiring engineers in the "competitive Bedford, Mass., job market."
<<Although you claim that most of their licensing deals are only PR, they are at least able to claim partnerships with major vendors, which still have quite a bit of potential (especially the DSC deal).>>
I didn't say they were only PR. the USRX thing is obviously quite real... it's just that AWRE won't see any more money from the deal. PAIR and ASND are question marks. DSC is a question mark too, since the BA/NYNEX deal looks to be all CAP. I talked about AWRE's partners and their prospects in an earlier post.
<<I simply believe that Aware has better management than the other ADSL companies and that in the long run this will prove to be the key point.>>
i'd rate them last among the ADSL management teams i've met or had the chance to see in action (e.g. WSTL, AMTX, AWRE, ALA). of course that's entirely subjective.
All this IMO. std. disclaimers apply.
mark |
