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Technology Stocks : Ciena (CIEN)

CIEN 195.76

+7.0%

Nov 5 4:00 PM EST

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To: Carmine Cammarosano who wrote (2878)	9/10/1998 1:45:00 PM
From: Sam Citron	Read Replies (2) of 12623

Ciena was just the bunny to take a technology that Lucent, Pirelli, Alcatel and others had spent many millions of dollars and many years developing in the laboratory and start selling it to the new wave telecom carriers. Ciena never was ahead of the tech curve, they were just ahead in marketing and finance. Their IPO was a wake up call to the industry. Twenty three year old analysts extrapolated growth rates from year 0 to year 1 into infinity and were unphased by a brand new company with a market cap of 8 billion. Shame on them! They should take another look at Mike Porter's Competitive Advantage. Their business model was not sustainable. Their competition was spending more on photonics R&D than Ciena was making in total sales. What made them think the world needed all that bandwidth right away anyway. The demand just isn't there yet. The pipes are still being built. The optical amps will accept drop-in cards once people start downloading Titanic en masse. Maybe they will be able to rent 32x cards for mothers day when the network is jumping. Sam

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