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Technology Stocks : Ascend Communications-News Only!!! (ASND)

ASND 209.35

-1.4%

3:59 PM EST

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To: Gary Korn who wrote (1166)	2/12/1998 7:18:00 PM
From: Maverick	Read Replies (2) of 1629

You are correct that AT&T uses mostly Stratacom BPX's for their frame relay network. They aren't changing that to my knowledge. But for sure, they have now settled on Ascend/Cascade for ATM. And ATM is where the new AT&T investment is targeted. They're pretty much done with their frame relay cloud. It would have made sense for them to continue using Stratacom for their ATM, since they already have so much Cisco in their network. This would have made support and operation of their network so much easier. But for some reason, they chose Cascade/Ascend over Cisco. I think that alone shows the superiority of Cascade over Stratacom. It is proof that Cascade/Ascend is really taking away business from Cisco. Wigblast, remember that Cisco really wanted to buy Cascade, but then had to settle for Stratacom. The Cascade switches are not junk. They are the most advanced and reliable data switches available on the market today. And I believe they're also putting a crimp into Newbridge's plans. I believe the $30M contract is only the beginning. Much more ATM investment planned from AT&T to the year 2001. Expect follow-on contracts for GX550 and support. AT&T is getting very aggressive here. The $$ from the AT&T contract will not start coming in till the 2nd half of 1998. I think ASND will be much higher by that time than it is today, in anticipation of revenues from this contract and Wiltel, and other CLEC's. Long term, this contract really gives ASND (or their acquirer) the credibility that they need to compete directly with Cisco. I think Chambers is really worried about ASND and their future acquirer. Cisco should have had this contract. There is no excuse for losing this one. They had all of AT&T's frame relay business, and they lost the ATM to Cascade. And ATM is where the growth and future is. Eventually Frame Relay will start to decline and perhaps become like X.25 is today (well, it will probably continue to be used, but in increasingly niche applications). [Posted for bucky89]

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