EarthLink Network ELNK Wraps Your Fish Message Board

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Technology Stocks : EarthLink Network ELNK Wraps Your Fish

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To: John Grandy who wrote ()	1/24/1997 12:10:00 PM
From: John Klein	of 11

This company has always been one of the more amusing stories in the IP world, and I was surprised to see that the stock has made any movement upwards. The dial-in Internet access market long has been abandoned by just about anyone with any long-term sence. My feeling is that despite the hype surrounding 56K modems, ultimately the winners will be those companies that either own IP network of any scale (what are referred to as NSPs - and of the 8000 or so ISPs, only about 6 companies can make the claim to being true first-tier NSPs), those companies that cater full-service to the business community (second-tier full service LAN/WAN integrators), and the telcos (small and large). Ultimately bandwidth requirements will be such that the only solution will be digital-to-the-door - ie, xDSL. Earthlink will only be able to milk the analogue consumer market so long (consumers will demand upgrade to 56K modems, which will become money down the drain in a year or so as app's become designed around multimegabit interfaces). As the NSP's and the telco's chase the business market, and invest the capital necessary to develop multimegabit digital loops, dial-in providers like earthlink will be squeezed by pricing pressures and overhead (remember, as a rule there is less overhead to supporting a knowledgable engineer paying you $30,000/mo for a DS3 then that required for a newbie with a $19.95 Win95 dial-in kit. And the dial-in customer will switch providers at the drop of a hat. Oh, and did I forget to mention cable modems? The ultimate consumer IP interface!) This is one of the best short positions of the new year. I look forward to my return. Who know's, maybe I'll use my profits to by a cable modem.

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