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Technology Stocks : Ascend Communications (ASND)

ASND 201.08

+2.6%

Nov 11 3:59 PM EST

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To: Bindusagar Reddy who wrote (59571)	1/27/1999 1:14:00 PM
From: The Phoenix	Read Replies (2) of 61433

BR, Again, as I mentioned before I expected to get naysayers. In fact no one sighted these sales into carriers (at least on this thread) as a potential market erosion to ASND/LU. I bet ASDN/LU execs see this differently. Second, if you take a moment you'll notice that CSCO continues to migrate revenues from low cost to higher cost devices. I agree with you, margins will shrink....a point or two at the most - still well above 60%. Furthermore consolidation reduces competition pushing prices higher...so it should be interesting. Cisco keeps telling the analysts that margins will shrink and they just don't. I think even the Chambers is surprised. Why don't they shrink...well, besides the points I just made Cisco continues to increase sales over the net (reducing admin. costs) and continues to improves sales for network design, installation, and support. These high margin sales will help limit pricing pressure IMO... OG

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