<<Again, I don't think LU is interested in ASND. LU needs to get better presence in international markets. They'll look to the datacom part of Siemens, ERICY, or someone like that. ASND really doesn't buy them that much... They already have what they need; an agreement to sell ASND's core switches. Buying ASND gets them better pricing on those switches but doesn't allow them to break into new markets. They're already closer to the carriers than ASND is......>>
Hi Gary,
<<Again, I don't think LU is interested in ASND>>
That may or may not be true. I think they are CERTAINLY interested in what Ascend does. Who else is serving the core and ISPs as effectively (and as profitably) as ASND ?
<<LU needs to get better presence in international markets.>>
During the past two months, we've seen a roll call of international contract awards for ASND for this country or that country's core or ISP needs. Most recently, Argentina. I hear there are some others in their back pocket, they just trickle them out as needed.
<<They already have what they need; an agreement to sell ASND's core switches.>>
This relationship has been in place for a long time, it did not just start in the last couple of years. Lucent has always wanted more than just the switch, they wanted to collaborate technically with ASND, which they have done in certain areas, for longer than the past two years. Due to this relationship, LU would realize much technical added value very quickly, in addition to "cheaper switches", if they bought ASND.
<<They're (LU) already closer to the carriers than ASND is>>
To AT&T, yes. RBOCs ? Sure, LUs close there, what are they going to do, sell them another 5ESS ? MCI/Worldcom I think will stay in ASND camp, what will LU sell them without ASND. Then there's Qwest, Williams, and other next generation networks. LU could use ASND there. And thousands of ISPs. It would take LU years to TRY to displace ASND in these accounts.
I don't think ASND has missed the boat at all. On the contrary, Mory, starting from a very weak position relative to the major players, trumped Chambers badly on Cascade, and has deftly bought Stratus, sucked the life giving juices from it, and discarded the pieces of exoskeleton aside (and will get good money for them). I think LU is watching keenly and has been trying to figure out how to get Mory his $100 bucks a share without diluting LU earnings.
jww
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