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Technology Stocks : CAWS - Wireless Cable (New and Improved)
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To: Zorro who wrote (5450)7/27/1998 10:06:00 PM
From: .com  Read Replies (2) of 5812
 
Hi Zorro,
I read through the extensive filing amendment regarding valuation estimates.

Obviously, I defer to your judgement on the value of their spectrum.

In my opinion, they were using the LMDS auction as a rationale for devaluing the worth of their spectrum as a negotiating ploy. While they probably have some basis to lower the value from what they originally paid, using the amount paid for LMDS spectrum rights is not a fair method and is an approach which could easily be argued against in court. The spectrum capabilities are not similar. The efficiencies and capabilities of the MMDS spectrum far outweigh what can be done with LMDS. I think that CAI is purposefully misleading the bondholders with this information in order to convince them to adopt the reorganization plan under management's terms. I hope you don't mind, but I sent that entire attachment, and your analysis, on to the lawyers.

As I mentioned above, they PROBABLY, can successfully argue that the spectrum is not worth 100% of what they originally paid for it. This is due to the fact the only a select few MMDS operators have been able to deploy the spectrum as the originally intended (for video and data). New business models are primarily for data services only. While this can be lucrative, I have not seen the business models to be able to compare the upside of data only to video and data. I would assume that a larger revenue stream and profit margin could be generated by bundling both services.

The failures of most of the remaining MMDS companies, and the re-sale of some of the MMDS spectrum, probably has lowered its value some. But not to LMDS levels (especially in what was a recent crummy auction).

I agree, I would really like to also hear from WTC on this matter.

PS: Haven't seen the new Zorro movie. I see it has been doing well at the box office. Do you get a percentage?
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