Steven, Interesting that you mention the question of whether TGNT is putting new customers on wireless or leased lines. If you recall in their early press releases they were touting themselves as the only p-mp wireless vendor. Also, their early marketing strategy, which I heard first hand in our office from the sales manager of TGNT, was that they were not going to make the mistake that WCII was making by first selling leased lines in new markets. They were only selling to customers where they had wireless links. In fact, we were evaluating WCII at the time and they could not give a competitive bid because they would not resell Bell ATlantic lines.
However, yesterday in their phony press release announcing service in 4 new cities increasing their total cities to 23, this is what they said in the bottom of the release:
<As it builds its local networks, Teligent is combining the latest in point-to-multipoint radio technology with more traditional network technology, including point-to-point fixed wireless and broadband wireline, to access its customers. Point-to-multipoint radio technology offers significant cost savings because it allows a single base station to serve a large cluster of customer buildings.>
Seems to me they've been forced to accept what WCII learned very quickly is that to grow the business you had to use leased lines to get your foot in the door until the building could be switched to a wireless connection.
325k of revenue in 19 operational cities is $17,105 per city for the quarter. I have to believe that some analysts will start to compare and contrast the stark difference between WCII and TGNT and the significant difference in the pace of their rollouts.
Add to that the disparity in licenses controlled (no need to rehash the channel pop vs population calculations, but clearly TGNT is the weak sister to WCII and NXLK in license coverage) and there is a big disconnect in the share price of TGNT. Consider these market caps:
$1.8 billion for TGNT
$1.7 billion for WCII
$955 million for NXLK
Which would you rather own (assuming you understood the dynamics of fixed wireless) NXLK or TGNT. It's a no brainer.
Any way, that's my TGNT rant for the day.
Best regards, Brian
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